When I first got Spotify I was comletely in love with the system; but I have slowly fallen out of love to the point where I have almost stopped using the program. Economicly they are living on the edge, and the smaller record labels and 'normal' musical stars make very little money. Rumors speak of payments less than a dollar a month for their whole catalouges, which makes it impossible for the small-guys to make money on this; thus only making it a good deal for touring bands (making their money on spectators and merchandise).
Now, interestigly, they have hired one of the piratebay judges as a 'product developer' or somesuch: waving the banner of the fossile music industry. If you deal with the devil et cetera...
Spotify's basic package is free if you get an invite (or live in Sweden); and you get to choose from an amazing library of music lacking only a few of the great ones like Bob Dylan or Pink Floyd.
Spotify is sadly using an extreemly stoopid technique to push folks into the payment program where you pay 1€/24 hours (good for dinnerparties and such) or 10€/30 days for an ad free-musical experience. By playing annoying Spotify infomercials they aparently hope to be annoying enough that I will pay 10€ a month for the full product; not realizing I simply plug my external hard-drive back in and listen to my extensive collection of CDs I used hundreds of hours ripping.
Why is this stupid? Because now only stupid people will buy commercial spots on Spotify; who wants their product connected to annoying? Once they, or their competitors, realize they infact are a radiostation 2.0; where the listeners make the playlists: they will surley make more money on the unpaying customers than the paying ones.
How do you know your product is good enough? When paying customers demand the possibility to listen to the free-version if they feel like it; 'Spotify Radio' has reached its minimum benchmark.