Spotify Premium Is About To Get More Expensive

Spotify is reportedly planning on raising the price of its premium plan the United States to $10.99 a month.

According to The Wall Street Journal(Opens in a new window), the brand plans to announce the $1 increase of the cost of the service, which is currently $9.99, next week. Citing people familiar with the matter, the paper reports that the price is expected to likely increase in other markets over the next few months.

Spotify’s premium plan currently allows customers to list to any music they’d like ad-free and offline for $9.99 a month. Additional users come with additional fees.

The price is in many ways long overdue. Apple raised the cost of Apple Music from $9.99 to $10.99 in October of last year, and Amazon Music followed suit in January, raising its price to $10.99 as well.

In October, Spotify CEO Daniel Ek even suggested a rice increase was imminent. During Spotify’s earnings call at the time he said that a price increase in the United States “is one of the things we would like to do,” At the time, Ek told investors Spotify could potentially raise prices in 2023 “in light of these recent developments with our label partners.” 

On the call Ek also noted that the company has “the lowest churn of any competitor,” meaning that Spotify users tends to stay with the company, and he feels that raising prices likely would’t cause many customers to leave the service.

On Thursday, YouTube Music also raised its price for an individual streaming plan to $10.99, making Spotify the only major service to still have that $.99 price tag.

While $1 a month is a small increase for customers, Spotify stands to dramatically raise its profits with the increase. On a call with investors in May, Warner Music Chief Executive Robert Kyncl noted that Spotify a $1 price increase in the United States would bring Spotify $1billion in additional revenue.