694

Spotify is raising the cost of Premium subscriptions, again (www.engadget.com)

submitted 5 months ago by cyberpunk007@lemmy.ca to c/technology@lemmy.world

327 comments fedilink hide all child comments

Spotify is officially raising its Premium subscription rates in the US come July, following reports of the move in April. The platform is increasing its Individual plan from $11 to $12 monthly and its Duo plan from $15 to $17 monthly — the same jump as last year's $1 and $2 price hikes, respectively. However, its Family plan is going up by a whopping $3, increasing from $17 to $20 monthly. The only subscribers getting a break are students, who will continue to pay $6 monthly.

Spotify announced the price hikes less than a year after its previous one last July. Before that, Spotify hadn't raised its fees since launching a decade and a half ago. I guess it was too optimistic to hope the next increase would also take that long, especially with Spotify's continued focus (and money dump) on audiobooks.

Premium subscribers should receive an email from Spotify in the next month detailing the price hike and providing a link to cancel their plan if they would prefer to do so. Users currently on a trial period for Spotify will get one month at $11 after it ends before being moved up to a $12 monthly fee.

you are viewing a single comment's thread
view the rest of the comments

[-] GenEcon@lemm.ee 25 points 5 months ago* (last edited 5 months ago)

The problem is that Spotify is losing money each year. They aren't profitable. And if they are keep focusing on music, they never will. Their deal with the music labels says that they need to give 70 % of each subscription to the music labels. So by getting more people to signup, they only marginally increase their revenue. Same goes for raising their prices.

Thats why they tried focusing on Podcasts and Audiobooks. Those are a lot more profitable, either by adding ads (Podcasts) or by charging a premium (audiobooks).

[-] kwirky@lemmy.ca 12 points 5 months ago* (last edited 5 months ago)

It's amazing to think how incompetent their management must be that they're charging more, delivering lower audio quality, and paying less to artists than competitors like Tidal, yet still aren't profitable.

[-] GenEcon@lemm.ee 4 points 5 months ago

They pay less than Tidal claims it pays. So far Tidal has a really bad history of publishing correct numbers.

[-] Spedwell@lemmy.world 7 points 5 months ago* (last edited 5 months ago)

There is an episode of Tech Won't Save Us (2024-01-25) discussing how weird the podcasting play was for Spotify. There is essentially no way to monetize podcasts at scale, primarily because podcasts do not have the same degree of platform look-in as other media types.

Spotify spent the $100 million (or whatever the number was) to get Rogan exclusive, but for essentially every other podcast you can find a free RSS feed with skippable ads. Also their podcast player just outright sucks :/

[-] Knock_Knock_Lemmy_In@lemmy.world 1 points 5 months ago

Hang on. 70% of the subscription before any royalty / streaming costs?

So in a $10 payment, $7 is immediately removed, then another say $1 for streaming costs leaving only $2 for profits which Spotify takes 30%?

From each $10 only $1.40 goes to artists?

[-] GenEcon@lemm.ee 2 points 5 months ago

From the 10 Dollar, taxes will be deducted. Afterwards Apple or Google take their share (if you subscribe using the App). Of the remaining money the Music labels take 70 %, and Spotify keeps 30 %. The music labels pay a fraction of the 70 % to the artists, depending on the contract and the artist's share of streams reported by Spotify.

[-] JohnEdwa@sopuli.xyz 1 points 5 months ago

Spotify also has 236 million premium subscribers.
Let's assume everyone paying US prices and nobody decides to cancel because of this - both of which are false - that $1 increase would mean Spotify users pay 2.8 billion USD more per year and Spotify gets a cool 850 million.

[-] lazycouchpotato@lemmy.world 0 points 5 months ago

Interesting. I wasn’t aware that they weren’t profitable.

Funny enough, right after your comment I got recommended this video on YouTube talking about the points you mentioned: https://youtu.be/yDWgOwb8kj4

[-] PipedLinkBot@feddit.rocks 3 points 5 months ago

Here is an alternative Piped link(s):

https://piped.video/yDWgOwb8kj4

Piped is a privacy-respecting open-source alternative frontend to YouTube.

I'm open-source; check me out at GitHub.

this post was submitted on 03 Jun 2024

694 points (98.5% liked)

Technology

59259 readers

1558 users here now

This is a most excellent place for technology news and articles.

Our Rules

Follow the lemmy.world rules.
Only tech related content.
Be excellent to each another!
Mod approved content bots can post up to 10 articles per day.
Threads asking for personal tech support may be deleted.
Politics threads may be removed.
No memes allowed as posts, OK to post as comments.
Only approved bots from the list below, to ask if your bot can be added please contact us.
Check for duplicates before posting, duplicates may be removed

Approved Bots

founded 1 year ago

MODERATORS