Ad funding issue remains the trickiest hurdle.

AD-FUNDED MUSIC SERVICES will only work in certain contexts and markets, while streaming services will not migrate easily onto mobile: these were the conclusions at the audio, video and mobile panels at Music Week's Making Online Music Pay conference.

With so much focus on ad-funding, the commercial realities were laid bare by a number of services already active in this area, including MUZU, We7, Last.fm and Spotify.

We7 CEO Steve Purdham said that "using ads to pay for the music seems an ideal approach" in today's market but balanced this by saying that no ad-funded service was profitable today and they were instead relying on venture capitalist funding. He was, however, optimistic that the move to profitability was imminent.

Last.fm SVP of international advertising sales Miles Lewis warned that it was going to be difficult to convince "a whole generation of consumers growing up with `free' to give you their credit card details".

He suggested the future lay in delivering a package of services and experiences to consumers. He also revealed that ad-funding was only viable in mature ad markets but gave the example of Poland as one where users can be migrated from a free platform to a paid one.

This was reiterated by Spotify UK managing director Paul Brown, who said that across the board there was a "deadly serious focus on monetisation". He also confirmed Spotify would launch in Nordic territories soon, with the US on the horizon. Echoing Lewis's point, he said that Spotify would be subscription-only ...