Spotify subscribers are set to face another price rise, despite it being less than a year since the last increase. The apparent latest effort by the company to boost revenue amid similar price hikes introduced by other entertainment streaming services. In an email sent to customers, the streaming behemoth announced that the monthly fee for a premium subscription will go up by $1 starting in May, marking an approximate 7.7% hike.
The price hikes will help cover the cost of audiobooks, a new service offered by the company, Bloomberg reported.
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Key Takeaways
- Spotify will increase prices for its subscription tiers by up to $2 across five markets by the end of April, including the U.K., Australia and Pakistan, before raising prices in the US and Australia later this year, unnamed people familiar with the matter told Bloomberg.
- Individual plans will reportedly increase by $1 while family and duo plans will increase by $2.
- The new prices will help Spotify cover the cost of audiobooks, a new service introduced last year that has been offered for free to subscribers for up to 15 hours of listening per week, Bloomberg reported.
- Spotify will also roll out an $11 monthly subscription tier that will offer music and podcasts without audiobooks, requiring users on the plan to pay for audiobooks.
- That new tier will be among new pricing options offered by Spotify, including a new “supremium” plan that includes high-fidelity audio at a higher price.
Big Number
At least $9 billion. That’s how much Spotify paid record labels, artists and others last year, according to the company. The company previously said it pays about 70% of every dollar it generates from music back into the industry. Spotify reported 236 million paying customers through the end of 2023.
Related
Tangent
Other entertainment streaming services have announced similar price increases over the last year. In August, Amazon increased the monthly price for its individual Music Unlimited plan from $8.99 to $9.99 and its Music Unlimited family plan from $15.99 to $16.99 per month. In January, Netflix reportedly told investors the company planned to increase the monthly price for its subscription tiers this year, after increasing the price of its basic plan from $9.99 to $11.99 per month in the U.S. in October.
Key Background
Spotify announced its most recent price hikes for its monthly subscription tiers in July. The company charges more for its Premium, ad-free subscription than Amazon’s Unlimited plan, after raising its monthly fee from $8.99 to $10.99. Spotify also announced last year its subscribers would have access to audiobooks in a new service to compete with Amazon’s Audible. A “supremium” subscription has been in the works since 2021, according to Bloomberg, as both Amazon Music and Apple Music offer HiFi audio streaming for free as part of their standard subscription plans.
This article was first published on forbes.com and all figures are in USD.
