The Swedish Spotify has invaded American shores after clearing up lingering licensing issues.   The big question now is if Americans will ditch Pandora and signed on with Spotify.

Spotify is a good product; their 10 million non-US users attest to that.  

It's arguably music streaming at its finest.  Customers love its crisp quality and robust software design.  It plays music from your iTunes library.  For $10 per month, you get offline and mobile device access.

Of course, there are other services like it, but one should never underestimate the power of service done right.

For example, Google.com and the iPod weren't offering exclusive services but their quality still allowed them to become multi-billion dollar products.

However, the one thing Spotify doesn't have and Pandora does have is the Music Genome Project technology, which is an awesome way to discover music.  So far, no other company has been able to replicate this service. 

Largely because of this technology, Pandora offers a better casual radio experience than Spotify for many users.

So will Spotify shake Pandora's dominant position in the US?

This question is somewhat like the Internet version of will CDs (Spotify) kill radio (Pandora).  CDs, of course, didn't kill radio.  However, it did take away some market share.

What may end up happening is that Spotify will take away Pandora's music-on-demand users but not its music discovery and radio users.

Pandora and Spotify are both good are what they do; which service individuals choose will likely depend on their personal needs.