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Spotify, Swedish startup offering wonderful instant music streaming experience to the masses, brings in Henrik Torstensson as Head of Premium Sales. To be able to continue to afford the expensive appetite of the music industry, it needs a new weapon to gear up the conversion rate of today’s 4,5%.

Leaving his role as General Manager Piczo and SVP Strategy at Stardoll, the world’s largest online fashion and games community serving over 60M registered users with virtual dolls for girls, Henrik is closing the circle by reuniting with Daniel Ek, CEO and Co-founder of Spotify. Henrik and Daniel go way back, Stardoll being the recent shared office space before Daniel left to co-found Spotify.

Classic Music Startup Dilemma

To “feed” the music industry, while pursuing its admirable goal to offer instant music streaming experience for free to the masses, Spotify is fighting the ever tricky equation of digital music services, as Peter Kafka of MediaMemo AllThingsD puts it:

“But no one has figured out how to rent music at a price that satisfies consumers, the labels and the music services. At least not on a large scale.”

Spotify keeps battling the classic digital music startup dilemma of affording to scale up the service in attempt to increase the speed and the stickiness of the service. The more social the service gets, the more expensive the bill to the music industry. Not too surprisingly, the overwhelming demand of new social sharing features released for a month ago, to meet the long-awaited easier music discovery, was also followed by new subscription models.

Old Business Models Refusing To Embrace The New Ones

Unfortunately, those who offer the shiniest object in return for the music industry copyrights, as is also the case in the movie industry, are the ones to get the deals. The competition is harsh with new players like Rdio entering the battle field, and whether or not Steve Jobs is to announce Apple’s new cloud strategy next week at WWDC, no doubt, he too will be in the bidding wars.

A mind-blowingly disturbing demonstration of the fact how the music industry refuses to embrace and innovate around new digital revenue models, was to hear Scooter Braun, manager of Justin Bieber at TechCrunch Disrupt, telling how “55M YouTube views wasn’t enough to convince any record label to sign up Justin”. One would imagine, that in year 2010 there would’ve been a line reaching out around the corner. I also think Scooter Braun delivered The message of the year to the music industry:

” If we don’t come to conferences like this and find that next young entrepreneur and find that next idea and become a part of it, we’re going to die.”

Or to quote Troy Carter, manager of Lady Gaga:

“The fact that it’s called Disrupt should have every record label here right now because no media business has been more disrupted like the record business “

Henrik, until the music industry catches up with the reality: So long neighbor, and best of luck in London in taming the music industry “beast”!

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More good read on Spotify and its US launch by Mike Butcher.

To my Swedish speaking readers, read also Mikael Zackrisson of VA.se’s great coverage of the latest adventures of Spotify.  

Find out more About Me and fellow Top 100 Women in Tech in Europe. Connect with me on Twitter, LinkedIn, Facebook, or just drop me a line! Subscribe to my Feed, Startup Advice, and Swedish Startups Twitter list. And remember, “You never learn anything when you speak, only when you listen” – Roelof Botha / Douglas Leone, Sequoia Capital