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Headsets hang in front of a screen displaying a Spotify logo on it, in Zenica February 20, 2014.DADO RUVIC/Reuters

Long the money-grubbing kid brother to better-funded Internet-video services like Netflix, streaming music is starting to seriously get its due.

First, the Wall Street Journal reported on Thursday that Sweden's Spotify AB, widely considered the world-leading music streaming service, is looking to raise about $500-million (U.S.). Within hours of Spotify's funding announcement, it emerged that a company – Project Panther Bidco Ltd. – owned by rap king Jay-Z was making a $56-million bid to buy Spotify rival Aspiro AB.

Rumours have long swirled of an initial public offering for Spotify, but the company has remained mum on the subject. While the funding suggests an IPO is further away than suspected, the Journal reports that the company is in talks with investors who tend to buy into companies before they go public. Insiders are valuing the company at more than $7-billion, making it one of the highest-valued in the world.

That's a huge number for a company that hasn't turned a profit. With their current business models – in which most people use free, ad-supported versions instead of premium paid memberships – the vast majority of streaming music services are perennial money losers for just about everyone but the end user.

But financiers are surrounding global streaming leaders in droves, indicating a growing confidence that one of them, maybe soon, will turn a profit through either paid memberships or well-targeted audio advertising.

The battle for market share has become an arms race for streaming companies. Even in the smaller markets like Canada, where many companies were hesitant to launch, new services have flooded in.

For a few years, the Canadian scene was dominated by mid-sized players like Rdio, which entered the country very quickly after starting. But in the past year, Google Play, Spotify and the more expensive, high-fidelity TIDAL service all launched here, signalling more international investment and cultural significance for the fledgling industry.

Right now, the primary candidate to win the war for profitability appears to be Spotify, which reached 15 million paying subscribers at the end of 2014. That's one-quarter of its 60 million active users – an impressive after more than a decade of high-seas music piracy.

In the past decade, Jay-Z – real name Shawn Carter – has become almost more renowned for his entrepreneurial chops as his rhyming. His deal for Aspiro fits in perfectly with the rap star's investment portfolio.

Aspiro runs the high-fidelity music services WiMP in Europe and TIDAL in markets like U.S. in Canada. The low sale price is an easy indicator that Aspiro's services carry much less market share than juggernaut Spotify. Meanwhile, the business proposition of high-definition streaming has some serious logistical problems. TIDAL costs twice as much as most rivals ($20 versus $10 a month) and requires high-end hardware to make the price difference worthwhile.

But in terms of artistry, Jay-Z is one of the last music superstars whose sales matches their swagger, selling 50 million records. Why would he invest in a service that pushes consumers further away for more profitable albums? But Jay-Z likes to bet on luxury franchises that, with his brand's magic touch, can make a name on the world stage.

Consider the Brooklyn Nets, whose affiliation with Jay-Z – in spite of his fraction-of-a-per-cent share of the team – helped breathe new life into the team as they jumped the Hudson and East Rivers.

After a long-time allegiance with Audemars Piguet watches, he shifted loyalty to its rival Hublot several years ago, forming an even tighter partnership that helped rebuild the once-ailing watchmaker.

And his 2008 jump from longtime label Def Jam to a nascent Live Nation helped fuel the latter to becoming one of the world's most influential entertainment companies.

Album sales are dropping, so it's smart to have a hand in the their natural successor. He's clearly already comfortable releasing his music on unconventional platforms, having released his 2013 record Magna Carta ... Holy Grail early exclusively on Samsung Galaxy smartphones. Since he makes luxury rap, it makes sense for Jay-Z to invest in luxury streaming.

And his investment is a strong sign that streaming music might be worth something someday soon. As a Brooklyn rapper once said: Sounds so soulful, don't you agree?

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