The term bait-and-switch is most commonly used in retail sales where customers are “baited” with products or services offered at a low price, only to discover that the advertised goods are not available and they’re “switched” to a pricier product.
Spotify, the free streaming music service which made its US debut in July 2011, just announced that all users will now be limited to just 10 hours per month and they’ll only be allowed to play individual tracks no more than five times per month. That’s because Spotify’s unlimited music (the bait) is now only a limited time offer. After your 10 hours of streaming music per month, the ad-supported Spotify hopes that you’ll sign up for one of its paid plans (the switch).
Dwindling subscriber businesses such as The Wall Street Journal and The New York Times have already fortified themselves behind Internet pay-walls. Does Spotify’s recent bait-and-switch business model herald a new direction for companies hoping to profit on the Internet?