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Spotify Lost TracksEuropean music service Spotify has only been available in the U.S. for a few weeks and it’s already being hit with a patent infringement lawsuit from little-known mobile media company PacketVideo.

The patent in question, No. 5,636,276, was filed in 1995 and is listed as a “device for the distribution of music information in digital form.” The vagueness of the patent makes it applicable to almost any streaming music service.

Spotify said it will strongly contest PacketVideo’s claim. The company’s full statement reads:

“In just under three years, Spotify has become more popular than any other music service of its kind. This success is, in large part, due to our own highly innovative, proprietary hybrid technology that incorporates peer-to-peer technology. The result is what we humbly believe to be a better music experience – lightning fast, dead simple and really social. PacketVideo is claiming that by distributing music over the Internet, Spotify (and by inference any other similar digital music service) has infringed one of the patents that has previously been acquired by PacketVideo. Spotify is strongly contesting PacketVideo’s claim.”

PacketVideo was an active startup several years back that focused on streaming video to mobile devices, and in 2010 the company was acquired by Docomo. PacketVideo had nothing to do with the patent originally and only purchased it a few years ago, according to TechDirt.

Sweden-based Spotify initially launched in Europe in October 2008. It currently has more than 10 million users worldwide, with 1 million paid subscribers. The company has raised $120 million thus far and is valued at around $1 billion.

What do you think of Spotify? Do you think the lawsuit is fair?


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