What you need to know
- Spotify is considering raising prices for U.S.-based plans.
- This comes after YouTube Premium, and Apple Music recently raised the prices of subscriber plans.
- Spotify would feel comfortable with a decision like this should it be made after talking with label partners, as it offers deep engagement for users.
Spotify may consider raising U.S. price plans as it moves into 2023, following a trend that other streaming services are falling into.
According to Spotify CEO Daniel Ek's comments during the company's earnings call, the music streaming service appears eager to raise prices. Ek prefaces things by reminding everyone that in the past two years, Spotify has raised prices more than 46 times in different markets, which have all resulted in being "as good as we have hoped for, if not better, in many of these places."
While raising prices in the U.S. is something Spotify CEO Daniel Ek would like to do, they would need to discuss things with their label partners first. Ek states that the price increase would be a comfortable decision because he believes that Spotify offers an "amazing consumer-value proposition."
The streaming service's CEO mentions Spotify's competitors, which include services like YouTube Premium and Apple Music, which have recently raised prices. YouTube Premium is raising its family plan by $5, taking the price from $17.99 to $22.99., the first price increase for the service in four years since it was rebranded from YouTube Red.
Apple Music has also raised its individual price plan up a dollar to $10.99, with its family going up $2 to $16.99.
Spotify sees its competitors raising prices as a good sign for itself. The company falls back into its "deep engagement" and lowest churn as a sign that it will fair better than others with a price increase.
In terms of how Spotify performed during the third quarter, it saw a steady growth of users and subscribers on the platform. The company also reports total revenue growth of 21% to €3 billion, which was above projections for Q3. The streaming service also saw its Premium revenue grow by 22% to €2.7 billion. Spotify also reports that its total monthly active users have grown to 456 million.
