Spotify, the world-renowned music streaming service, has announced another price increase for its subscription plans in the United States, marking the second such hike in less than a year. This move, which the company attributes to the need for continued investment and innovation, has sparked, erm, "discussions" (to say the least) among users and industry analysts alike.
Starting immediately for new subscribers and within the next month for existing ones, the cost of Spotify's various premium plans will see significant adjustments:
This price adjustment follows a previous increase in July 2023, where individual plans went up by $1 and Duo plans by $2. In just over a year, the Duo plan has seen a total increase of 30%, while the Family plan has risen by 25%, and the Individual plan by 20%.
In a blog post announcing the changes, Spotify stated that the price increases are necessary "so that we can continue to invest in and innovate on our product features and bring users the best experience." The company emphasized the need to adapt to changing market conditions and to maintain its trajectory of innovation and improvement in user experience.
However, the timing and frequency of these hikes have raised eyebrows, especially considering the recent economic climate marked by high inflation. Critics argue that frequent price increases could alienate subscribers, particularly when competing services like TIDAL, Qobuz, and Apple Music offer comparable plans at lower rates and with additional features such as hi-res streaming and Spatial Audio.
Current subscribers will receive an email notification about the new pricing structure and its implications for their accounts. Those currently on trial accounts will enjoy the current pricing for one more month before transitioning to the new rates.
As of March 31, 2024, Spotify boasts 615 million monthly active users globally, with 239 million of these on Premium accounts. The company reported €3.247 billion in Premium revenue for the first quarter of 2024, alongside €389 million from advertising on its free tier.
While Spotify continues to lead in terms of subscriber numbers, its latest price hike makes it more expensive than its closest rival, Apple Music. Apple Music's equivalent tiers not only cost less but also include features that Spotify has yet to roll out widely. Notably, Apple Music offers hi-res streaming and Spatial Audio at no extra charge, while Spotify's much-anticipated HiFi tier remains in development and may come with an additional cost.
Spotify's focus has also expanded to include podcasts and audiobooks, with the Premium service offering 15 hours of audiobook listening per month, a feature not available on Apple Music. Despite these additions, the price increase may still be a tough pill to swallow for many users, especially in a competitive market with numerous alternatives.
