Spotify Wants to Raise Prices After 12 Years
Spotify may raise its monthly subscription prices after 12 years of a fixed rate, CEO Daniel Ek shared on April 25.
Since 2011, Spotify has had its premium membership at a fixed rate of $9.99 per month. During the earnings call on April 25, which reports the company’s financial statistics for the quarter, Ek expressed the company’s desire to raise the prices.
Spotify says it’s “ready to raise prices” — with 210 million paid subscribers as quarterly revenue grows 14%. https://t.co/m6PuV2tiMO
— billboard (@billboard) April 25, 2023
Spotify reported a first-quarter loss of about $248 million compared with profit at this time last year. A rise in pricing is dependent on forthcoming negotiations with label partners. Spotify had a 14% revenue growth in the first quarter of this year compared to last year, partly due to a 15% increase in paid subscribers. 317 million listeners that do not pay for the premium subscription are still in the majority.
Listeners who pay for the premium members have access to ad-free music, unlimited skips, and downloadable music. There are also memberships available for families, with the family plan being $15.99/month for up to six accounts under one roof.
Spotify stock tanked almost 70% in 2022 after the company faced higher-than-expected losses. It moved up 7% on April 25 to $140/share. The streaming service had a tough first quarter, partly due to the same reasons most companies are facing in this economy. Spotify eliminated 6% of its workforce to cut costs and went through a change in its leadership as it restructured its podcasting and advertising sides of the business to offset heavy spending in the last few years.
ICYMI: Now you can listen to your favorite books on Spotify 📚 https://t.co/x2lNHRSKeO
— Spotify (@Spotify) April 25, 2023
As of right now, the default membership owners can get a premium for three months free until they pay the $9.99/month. There is no definitive answer on how much the price may be raised, but it very well could happen this year.
Writer
