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Financial Plan

The proposed service will be run under a financial plan citing two primary sources of revenue and four primary expenditures.

Revenue

The two primary sources of revenue will be user subscriptions and click-through advertising. Users will be offered the choice to pay a monthly fee for advanced features of the service, and discounts will be offered to users who subscribe for longer periods of time. When listening to or searching for a track, album, or artist, users will also be given the option to click on click-through advertising to a music store, such as the ITunes Store, where listeners will be able to purchase music. In addition, unobtrusive click-through advertising will be featured on the websites of unpaid users. Another source of revenue to consider as the company develops is collaboration with other businesses.

Expenditures

The four primary expenditures of the service will be to the four proposed divisions of the company: music, marketing and sales, research and development, and technical. In adidition to labor costs, each team will assume expenditures based on the nature of its operations. These expenditures include, but are not limited to, contracts with artists and labels, cost of advertising, and cost of technology. Other expenditures are also likely to be incurred.