But Spotify has yet to make a key expansion: To the U.S., where the big music labels worry that consumers will love everything about the site except paying for it. That’s bad, since Spotify is supposed to work best as a subscription service.

Most Americans have never heard of Symbian, though it remains the biggest player in the global smartphone market (as long as you use a broad definition of smartphone). But it’s telling that Spotify made a point of making its service compatible with Apple’s (AAPL) iPhone and Google’s (GOOG) Android handsets first.

In any event, Spotify is only available via mobile to paying subscribers, who shell out around $16 a month in the U.K. (and less in some countries). They key question for the music business is how many subscribers there are.

Spotify won’t release statistics, but one number that I’ve heard from people close to the company is 100,000, which works out to less than two percent of the company’s overall user base (free users can listen to the service only on their PCs and have to endure a small smattering of ads). But U.S. music industry executives worry that the subscription number may be even lower than that.

The two sides continue to chat, and conventional wisdom is that the service will indeed get to the U.S. one day. But at one point, Spotify was talking about coming to America in 2009, but that looks just about impossible. Now, CEO Daniel Ek is talking about the first half of 2010.

What else would you expect Ballmer to say? Now that Microsoft (MSFT) has got its hands on Yahoo’s (YHOO) search business–without paying a “boatload” for it–there isn’t a whole lot left to buy.

Emphasis on the word “buy.” Microsoft may still be willing to write a big check to boost its search share, specifically to get its hands on queries controlled by Time Warner’s (TWX) AOL, which has about three percent of the domestic search market.

AOL currently outsources its queries to Google (GOOG) in a deal that is said to make quite a bit of money for both sides of the table because AOL’s core user base tends to click through at a much higher rate than the rest of the Web. But AOL’s Google contract is expiring, and both Mountain View and Redmond are thought to be in hot pursuit of a new one. AOL CEO Tim Armstrong, though, is taking his time about his decision.

Also in the potential mix for Microsoft: A deal with News Corp. (NWS), which owns this site. Google’s $900 million search deal with News Corp.’s MySpace and IGN sites expires next year, but unlike the AOL deal, it has been a disappointment for Google.

It’s hard to imagine Ballmer spending much to wrest that one away, but News Corp. digital boss Jon Miller is doing what he can to drum up interest: He’s been talking up the idea of bundling multiple News Corp. properties–like, say, Dow Jones–into a larger deal. But since many of those properties have their own particular agreements and peculiarities, that’s going to take some doing.

The perennial, and obvious, solution is to incorporate ads into the service, but so far Twitter hasn’t tried it, except for very limited experiments.

The good news for Twitter and its investors is that the service’s user base is pretty receptive to advertising, in general terms, because it’s pretty receptive to just about everything on the Web.

So says research group Interpret LLC, which has a new study out today, conveniently enough. From the release:

Twitter users are twice as likely to review or rate products online (24% vs. 12%), visit company profiles (20% vs. 11%) and click on advertisements or sponsors (20% vs.9%) as those who only belong to traditional social networking websites like Facebook and MySpace. The data suggests that Twitter users uniquely demonstrate higher engagement with brands, not just with “tweets” they post.

These statistics are self-reported, and Interpret doesn’t say how big a sample its survey used, so take them with as much salt as you like. But they seem intuitively and directionally correct: Anyone willing to plug into the waves of information that Twitter pumps out is likely engaged all over the Web.

Note what the Interpret report doesn’t say: That Twitter users are eager to have ads inserted into the service itself.

Doesn’t matter. At some point, they’re unlikely to have a choice about that because it seems hard to imagine that Twitter can ever deliver on its investors’ sky-high expectations without generating some kind of money, somehow, from Madison avenue.

Which is exactly why Biz Stone and crew, who once made a point of expressing their derision for ads, now make a point of saying that ads may not be such a terrible thing, after all.

Instead, the New York-based company has just raised a $4.5 million Series B round that its CEO, 22-year-old David Karp, says will fund it for two and a half years. Union Square Ventures and Spark Capital, which led the company’s first $750,000 round a year ago, also led this financing. My educated guess is that its investors now value Tumblr at around $15 million.

Tumblr is a “microblog” platform that is supposed to let its users quickly create nice-looking posts with a minimum of effort; it sits somewhere between Twitter and full-fledged blogs like Blogger and TypePad. It is popular with a relatively small but prolific user base: Its 500,000 users have created pages that draw 15 million unique visitors and 61 million page views a month, Karp says.

Money? Nope. Tumblr is free–and has no ads cluttering up its hipster vibe.

Way back in 2007, those kinds of numbers would have been catnip for the likes of Google (GOOG) or Yahoo (YHOO). Now, though, even deep-pocketed buyers aren’t racing to snap up revenue-free start-ups. But Karp says raising money from his previous investors was easy: “These guys came to us with a deal that made us incredibly comfortable.”

Karp says he’s going to start generating money in early 2009. Not by selling ads on his members pages–Karp thinks the site will eventually incorporate ads in some way, but not yet–but by selling users “premium” services, most of which he’s not ready to describe. He does promise they will be “really sexy.”

More practically, Karp points out that other Web services, like the WordPress blogging platform and Yahoo’s Flickr photo service, have been able to upsell many of their users with goodies like extra storage. He figures many of his users will pay up, too.

The new money means he’ll have time to prove his thesis. Karp has just doubled his staff–which means there are now all of six people on payroll. One of them, hired in September, is John Maloney, Karp’s former boss at Urban Baby, where he started his Web career. Maloney is now in charge of business operations.

The money also means there are heightened expectations. Karp has done much more than people twice his age (and has the press clips to prove it). But the newest funding round means his investors think the company will be worth as much as $50 million by the time he sells it or raises more cash. In order to prove them right, he’s got a lot of work ahead of him.

[Image Credit: David's Log]