Spotify $SPOT customers in the U.S. are going to have to dig a little deeper into their wallets as the streaming giant has announced an 8% increase in the price of its premium subscription service.
The price increases come as labels seek higher royalty payments and the services shift from user acquisition to increasing their profit levels
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Spotify $SPOT customers in the U.S. are going to have to dig a little deeper into their wallets as the streaming giant has announced an 8% increase in the price of its premium subscription service.
Starting in February, the monthly fee will increase from $11.99 per month to $12.99. That's the third increase from Spotify in three years. Existing customers will have a one-month grace period to cancel before the increase goes into effect for them.
"We're updating our Premium prices to ensure we can continue to innovate in changing market conditions and deliver the best audio content around the world," the company said in a statement.
In June of 2024, the company announced subscribers in the U.S. would pay an extra $1 per month for ad-free streaming, bringing the price to $11.99 per month. That follows an announcement in July of 2023, where it hiked the price to $10.99 per month.
This is just the third price increase by Spotify since it launched in the U.S. in July of 2011.
It's hardly the only streaming service to increase prices. Pandora, in early 2024, bumped up the cost of its Premium monthly service from $9.99 per month to $10.99 (and hiked the price of the family option by $3 per month). Amazon $AMZN, in August of 2023, increased the price of Amazon Music to $9.99 per month. And Apple $AAPL Music, in October 2022, raised monthly prices by $1, to $10.99.
Those price increases come as labels seek higher royalty payments and the services shift from user acquisition to increasing their profit levels. Spotify says it has been profitable for more than a year.
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