The Wall Street Journal reports that Spotify Premium will see a $1 price increase later this year.
Spotify has been reluctant to update the price of its premium subscription for several years — despite competition raising prices. YouTube Music, Apple Music, Deezer, Amazon Music, and Tidal have seen various price increases for their services over the past 24 months. Now the WSJ is reporting that Spotify is ready to jump on the bandwagon for $10.99/month streaming music.
“In the coming months, there are likely to be further price increases in dozens of markets around the world,” he adds news article. Spotify is the world’s largest music subscription service. Analysts expect more price hikes across the board once Spotify raises its price.
“It’s breaking the dam,” Wedbush Securities analyst Daniel Ives says of the price hike. Ives called the price hike overdue as Wall Street pressured digital streaming providers like Spotify to become profitable. Video streaming services like Peacock and Disney+ have all seen price increases in recent months. Spotify told investors it plans to raise prices this year, but didn’t reveal a timeline for the price increases.
Spotify Premium was launched almost 15 years ago at a price of $9.99/month. It allows a single user to listen to Spotify’s entire music catalog ad-free and offline. Now that the price tier dam is about to burst, will Spotify experiment with more tiers? There has been speculation that the rumored Spotify Hi-Fi Tier would create a tier of service with access to Hi-Fi recordings and possibly audiobooks as Spotify attempts to break into the spoken word market.
The price of Spotify’s family plan rose in several markets including the United States over a year ago. Spotify has raked in higher revenue from families, so it’s no surprise that Spotify individual subscriptions are next on the price increase list. Warner Music CEO Robert Kyncl said in May 2023 that by increasing the price of its US subscription by $1, Spotify would generate $1 billion in additional revenue.