For the first time in the US, Daniel Ek, Spotify CEO wants to raise the prices for subscribers and believes that they “are ready” and “have the ability” to do so.
Recent reports from Spotify show that many of their statistics have improved. Their reported total revenue was up 14% from last year, active monthly users were up 22%, and they saw a 15% increase in premium subscribers. Despite these numbers all being on an uphill climb, their revenue was still less than expected.
Spotify’s prices were raised last year in “46 different locations and markets” and despite the price change were “still outperforming” in those areas according to Ek. Since price increases around the world did not seem to show signs of significant numbers of customers leaving the app, Spotify certainly has more pros than cons to do the same in the US.
Daniel Ek says that although Spotify was one of the lower-cost music streaming providers, it “isn’t a primary part of our strategy,” and “Instead, we’re working with our label partners. . .to figure out what’s the best opportunity.” Since these negotiations are “more complex,” Spotify has yet to decide when they will be able to implement the price increase. Ek said “When the timing’s right, we will raise it.”