In what only can be described as a Friday afternoon news dump meant to soften the ground before an earnings call the following week, The Wall Street Journal reports that Spotify is about to increase its monthly subscription fee for the first time.
Spotify Premium is set to increase by $1 a month to $11, according the unsourced report. Spotify itself has yet to announce any changes. Spotify has long resisted any price increases, but the move would bring it in line with all of its major competitors, some of which have seen recent increases to that $11 mark.
Spotify’s free service presumably will remain unchanged.
A price increase was all but assured by Spotify CEO Daniel Ek during 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 said at the time. “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 price increase also almost certainly was inevitable due to the fact that Spotify is still seeking to turn a profit (a fact also noted in the WSJ story). The company ended the first quarter with a 156 million-euro operating loss, and a total loss of 239 million euros.
Still up in the air, meanwhile, is whether Spotify is getting any closer to launching its long-awaited hi-fi lossless tier.
Spotify reported having 210 million subscribers to its Premium service as of March 31, 2023, an increase of 15% year over year, so a $1 increase would bring in an additional 200 million euros (and change) in revenue. (Premium also includes the Family Play and Duo Plan.)
Spotify will announce its second-quarter 2023 earnings at 8 a.m. ET on July 25.
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