Spotify Joins Rivals & Raises Rates
For the first time ever, Spotify is increasing its monthly subscription rate, according to the Wall Street Journal.
Joining ranks with other streaming services that already have increased their rates, Spotify Premium will reportable be raised by $1 a month.
No announcements from the Spotify camp yet, but the music streaming platform has held off price changes up until now.
The Spotify CEO Daniel Ek had already alluded to a prince increase over the company’s first-quarter earnings call.
“I feel really good about our ability to raise prices over time — that we have that ability,” he had said.
“And we have lots of data that backs that up. … When the timing’s right, we will raise [rates], and I think that price increase will go down well because we’re delivering a lot of value for our customers.”
The uptick in price is timed flawlessly with most all other streaming services increasing their rates and Spotify looking to increase profits after the company reported a $258 million-dollar operating loss for 2023’s first quarter.
As of March 2023, Spotify had 210 million subscribers and counting subscribed to its Premium service, which is a rise of 15% year over year.
With the increase of $1 for subscriptions, the review would be a substantial boost in revenue of $331 million.
We will learn more this week when Spotify will announce its second-quarter 2023 earnings, which might also be when it formally announces its rate increase.