Spotify Raises US Premium Subscription Costs
Spotify is set to raise the prices of its premium subscription plans in the United States. This change will go into effect within the next month, and it marks the company’s third price increase in four years.
New Pricing Structure for Spotify Premium Plans
The new prices for Spotify’s subscription plans are as follows:
- Individual Premium Plan: Increased from $11.99 to $12.99 per month
- Duo Plan (for two people): Increased from $16.99 to $18.99 per month
- Family Plan: Increased from $19.99 to $21.99 per month
- Student Plan: Increased from $5.99 to $6.99 per month
This adjustment comes after similar increases in markets such as the U.K. and Switzerland last fall. Spotify stated that these periodic price adjustments reflect the value they provide, which allows them to enhance user experience and support artists.
Notification of Price Changes
All existing Premium subscribers in the U.S., as well as in Estonia and Latvia, will receive an email notification detailing the upcoming price hikes. Prospective subscribers can find the latest pricing on Spotify’s official website.
Impact of Price Increases
While price hikes often meet resistance from consumers, music streaming continues to be viewed as a cost-effective entertainment option. Recent surveys indicate that listeners are open to paying higher prices. An op-ed from November suggested that even a modest increase of one dollar per month could generate an additional $500 million annually for the music industry.
This revenue could potentially assist not just Spotify and its investors but also artists, particularly songwriters who typically earn between $0.003 and $0.004 per stream. Given that multiple parties often share this amount, songwriters may see significantly less revenue, making it crucial for the industry to equitably distribute financial gains from price hikes.
Background and Leadership Changes
Spotify last adjusted its subscription prices in June 2024, following a previous increase in July 2023. This was notable as it marked the first price increment since Spotify’s U.S. launch in 2011, when individual plans were priced at $9.99 per month.
Additionally, there has been a leadership transition within the company. Daniel Ek, Spotify’s co-founder, has stepped down from his CEO position and transitioned to executive chairman. The leadership now includes co-CEOs Gustav Söderström, formerly the chief product and technology officer, and Alex Norström, who previously served as chief business officer.
