Music streaming platform Spotify Technology SA will raise the price of its premium subscription service by 8% in the US, Bloomberg reported.
The Swedish-based firm announced Thursday, 15 January, that prices in the US, its largest market, will rise from $12 to $13 per month. Prices will also increase in Estonia and Latvia. Although the company had already increased fees in some countries last year, US consumers had not seen a price hike since 2024, the news portal noted.
Customers to receive emails
Spotify said that the customers will receive an email regarding the latest plans and prices.
“We’re updating the price of Spotify. Over the next month, Premium subscribers across the US, Estonia, and Latvia will receive an email explaining what this update means for their subscriptions,” the company said in a release on Thursday, 15 January.
“Occasional updates to pricing across our markets reflect the value that Spotify delivers, enabling us to continue offering the best possible experience and benefit artists,” the statement further said.
Spotify shares rose 3% in pre-market trading on Thursday following the news. The company stated the move would help it to “continue offering the best possible experience and benefit artists.”
Pressure to hike subscription fees
Spotify, with over 280 million paid subscribers, faces pressure to hike prices to match inflation and rising costs seen in other consumer services like Netflix Inc, the news portal noted. The platform boasts highly loyal users who have spent years curating their music and audio libraries. Reports indicate that Spotify users are among the least likely to cancel their subscriptions compared to other major video or audio streaming services in the US, it added.
Over the last twenty years, Spotify has become the dominant player in the music industry and demonstrated profitability. However, growth has decelerated as streaming markets in key regions have matured. For the past couple of years, Spotify has been developing a new, higher-priced tier aimed at its most dedicated users.
(With inputs from Bloomberg.)
