I am still using the free version of Spotify. Most of the time I use it to listen to albums I'm thinking of buying from Amazon. It's so much nicer to be able to listen to the whole songs instead of the little snippets available on the Amazon website. The ads on Spotify don't bother me much, and if I really want something available for offline use, I buy it from Amazon. Sometimes I might spend $9.99 on music in a month (the cost of Spotify Premium), but I definitely don't do it every month, and I don't really want to. I just don't see that I'd use it enough or get enough out of it to justify the paid service. I know other people listen to music a lot more than I do, and $10/month isn't really that much for unlimited (legal) music.
How about you? Are you using Spotify? Free or paid?
