Spotify premium prices up, stocks down

After 12 years Spotify this week finally increased its premium service from $9.99 to 10.99 a month ahead of its Q2 earnings report. That was released yesterday. Despite publicising the continued gains in both monthly and premium subscribers, the company still had an operating loss of €247 million.

Any time there is a price rise on any subscription there is usually a push back from those who don’t want or aren’t prepared to pay it. In this instance the response on social media has largely been surprise at how little the rise was, myself included.

Not every market will get the $1 increase. Australia has.

The Q2 earnings saw Spotify stocks drop significantly. But if we use Spotify’s global 220 million premium subscribers (outlined in those Q2 earnings) and assume 200 million of them will get the increase, then that’s still an additional $24 billion annually, which would help.

Considering how well known and embraced Spotify has become globally, change seems to come at a glacial pace while major decisions, like their investment in certain podcasts and podcasting in general, spontaneously go in new and unexpected directions. It’s hard to know if this $1 increase means anything more than an adjustment to increased inflation and cost of living.

The reason why I pay my Spotify subscription is to avoid ads when I want to simply listen to music.

I think then that the reason the increase is just $1 a month is that if it was higher, without any additional benefits like the long promised HiFi audio quality increase, or worse (for me anyway), a forced ad component, I would shop around.

For now the $1 increase is all there is to see here. We’ll wait and see the impact on Spotify’s Q3 financial results.

Jen Seyderhelm is a writer and editor for Radioinfo
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