Spotify Raises U.S. Prices…Again, Spotify’s Sneaky Audiobook Move, Apple’s Opportunity
Happy Monday.
Spotify is raising prices in the U.S. for the second time in a year. Back in April, over at Inside Orchard, I discussed how Spotify is being pulled in different directions as its advertising apparatus comes in weaker than management hoped.
For today’s discussion, we are going to take things in a different direction as there are some changes in the music streaming landscape that Apple can take advantage of.
Let's jump right in.
Spotify Raises U.S. Prices…Again
Here’s Variety:
“Spotify is hiking rates for its monthly streaming plans in the U.S. for the second time in a year.
The Spotify Premium Individual plan is increasing by $1, from $10.99 to $11.99 per month, according to the company’s updated price listings. The Premium Family plan, which provides access for up to six members a household, is going up by $3, from $16.99 to $19.99 per month.
In the U.S. — Spotify’s biggest market — the company raised prices on its subscription plans in July 2023, the first time it had increased rates since launching in the country in 2011.
‘As we continue to grow our platform, we are updating our Premium prices so that we can keep innovating in changing market conditions,’ the company says in an FAQ about the price increases on its customer-service site. ‘These updates will help us continue delivering value to fans.’”
Even though this latest price increase had been rumored for the past few months, a June effective date is earlier than expected. We will go over what looks to be a big driver behind these price hikes shortly.
Price increases have become the norm across the streaming landscape. On social media, pushback to price hikes have been mixed.
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Spotify Earnings, Spotify Planning Supremium Tier, Warner Bros. Discovery Looking to License HBO Content to Netflix
Happy Wednesday. For today's update, we will take a spin through content streaming land.
Spotify Earnings
Back at the end of April, Spotify reported 1Q23 earnings.
Spotify management's narrative changing yet again. There is increased emphasis on paid subscriber growth and the impact it will have (eventually) on profitability. Although Spotify has never been shy talking about user growth since the company needs as many users as possible for its advertising ambition to materialize, premium subscriptions didn't receive as much attention in recent years.
As for what is driving the narrative change, Spotify’s premium sub growth numbers continue to be very strong. The company added 5M premium subs last quarter (bringing the total to 210M). Spotify earns most of its revenue (89%) from premium subscriptions.
Here is my go-to quarterly exhibit tracking Spotify subscriber trends:
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