Spotify is preparing to raise prices again in key zones, a major step toward sustaining profitability.
By the end of April, the streaming giant plans to increase fees by between $1 and $2 per month in five nations, including Pakistan, Australia, and the UK. Additionally, plans are in place to implement Spotify price increase later this year in the US, which is its largest area, according to Bloomberg.
Following this announcement, Spotify shares rose 4.6% to $281.92 in New York.
The Spotify subscription price increase will cover the expenses associated with Spotify's recent launch of audiobook services. Interestingly, the steaming platform intends to launch a new basic tier that would allow users to access podcasts and music for the current $11 monthly fee-audiobooks not included. With this project, Spotify may introduce a "supremium" plan for high-fidelity audio.
Shifting Business Strategy
Despite suffering constant losses since coming public in 2018, Spotify has made significant investments in podcasts and, more recently, audiobooks to diversify its sources of income beyond the music business. While these initiatives aim to attract and retain users, partners in the music industry are concerned about potential reductions in royalties. As a result, significant record labels have been pressuring Spotify and its rivals to increase their rates.
In a statement earlier in February, Spotify CEO Daniel Ek voiced confidence in the company's capacity to overcome obstacles, including the possibility of adopting a Spotify price increase. He admitted that the company suffered financially in 2023 due to its podcast investments, according to Reuters.
According to data on the business website, Spotify now provides premium subscriptions in the US for $10.99 per month for single users, $14.99 per couple, and $16.99 per family.
Read Also: Taiwan Earthquake: How Advanced Technology Helped Minimize Damage, Casualties
With unprecedented user growth following last year's Spotify price increase, the platform plans to raise individual subscriptions by $1 per month and family and duo subscriptions by $2 each. Apple Inc. and Amazon.com Inc. have reflected industry-wide initiatives to raise revenue and meet changing consumer preferences in their pricing changes.
(Photo : TOBIAS SCHWARZ/AFP via Getty Images)
The company logo of Swedish music streaming giant spotify is pictured on a smartphone in Berlin on January 23, 2023.
Furthermore, other income-generating strategies-such as early access to new music and individualized pricing for ardent fans-are being discussed within the music business. The cost of the main paid product is anticipated to increase, notwithstanding prospective modifications to pricing schemes. While Spotify works through these changes, the general trend is that accessing premium music streaming services is becoming more expensive.
Spotify Audiobook Service Coming to More Countries
In a related update earlier reported by TechTimes, Spotify extends its audiobook service to Canada, Ireland, and New Zealand, with free access for Premium users. Users who subscribe will receive 15 hours of audiobook credit starting on April 9.
Previously available in the US, UK, and Australia, this free bonus enhances the Premium package by allowing unrestricted music and podcast listening.
Credits, notably, do not renew every month. Spotify launched audiobooks in September 2022, but iOS removed audiobook sales due to disagreements between Apple and Spotify.
Select Spotify Premium members in certain countries had access to nearly 150,000 audiobooks last year. With the addition of literary experiences for Premium subscribers, Spotify is now expanding this service to more nations.
Related Article: JPMorgan Chase Enters Digital Advertising with Chase Media Solutions to Create Targeted Ads Powered by Customer Spending Data
