Earlier this year, Spotify announced that it would be raising prices. This has caused a lot of upset amongst its users. Its prices have been raised in countries like the UK, Sweden and Argentina, and in the Latin American region.
Price increases in Asia and South America
Developing Asia and South America are home to some of the world’s most interesting economies, so it’s no surprise that their governments and central banks are experimenting with a wide variety of policies to encourage growth and reduce unemployment. For example, in South America, monetary policy is tightening for the first time in years and that’s a good thing. Likewise, China is becoming a big player in the global economy, bringing with it some of the world’s largest demand for commodities. Hence, the cost of raw materials could increase across the board. However, this is a big opportunity for those who have a keen eye for economic trends.
The same goes for the region’s biggest crude oil exporters, which still qualify as net oil exporters. In fact, they have the largest oil and gas reserves in the world. As a result, oil prices are on the rise, which could shave a percentage point off the economy’s GDP growth rate. In other words, a higher oil price could translate to higher cost of goods in the short term. However, if a country can manage to sustain growth at a sustainable level, the benefits could outweigh the costs.
In short, a higher oil price is no panacea for a country’s economy, and it may be time to scale back the rhetoric and embrace the reality of a higher price tag. Likewise, a higher price tag can increase the cost of other goods and services, which may hamper economic growth, as well as consumer sentiment. The best way to ward off these challenges is to enact sound fiscal and monetary policies that promote growth and prosperity. The bottom line is, a higher price tag is a big pain for the poor.
Price increases in the UK and parts of Europe
Several countries are seeing pricing increases for Spotify plans. In the UK, Premium subscriptions will go up by PS1 or PS2 per month, and in the EU, premium plans will increase by EUR1 to EUR3. The new pricing will also affect family and student plans. The Premium Family plan will cost $16 a month, whereas a student subscription will stay at $4. The price hikes will take effect on April 30.
The price increase comes as Spotify has announced plans to introduce new features. The company says that the new pricing model will allow them to introduce more features. They also say that the price increase is necessary to pay more to artists. Streaming services have been under pressure to increase their profits as the streaming market has become more competitive. However, some are concerned that the price increases will increase piracy.
Spotify will also give new subscribers a month to try the new service. This is similar to the free tier, which is supported by advertising. They’ve also recently launched a new mobile home screen. It also offers discounted access to SHOWTIME.
Spotify has a free tier and a Premium tier. The Premium tier offers fewer restrictions than the free tier. The Premium tiers also remove advertisements. The Premium Family plan allows for six people in the same household to access the ad-free listening experience. The Premium Duo plan is also available.
Spotify has also rolled out new features for the free tier, including a shuffle mode that plays ads. It has also embedded its music player into Facebook’s mobile apps. The new feature will allow users to listen to full playlists directly from Spotify inside Facebook.
Spotify pricing increases in the UK and parts of Europe are expected to start on April 30, affecting premium plans. However, individual subscriptions will remain unchanged. The new prices will be announced in an email sent to subscribers. However, existing subscribers will have a one month grace period.
Spotify has also recently launched a podcasting feature. The company says that this is to allow it to introduce more features and content. However, Spotify is under pressure to pay more to artists.
Price increases in Brazil, Argentina and Sweden
Streaming music providers have launched premium plans in some countries. They’re looking to hit the sweet spot of mass market subscriptions. But they also want to offer low value subscriptions. This will give Spotify more leverage when it negotiates with music labels and majors for a larger share of their revenue.
In addition to streaming music, Spotify also offers ad-supported services. The company claims to have over 50 million music tracks. It also offers an add-on called Behind the Lyrics, which provides song lyrics and other information. In addition, Spotify allows users to shuffle songs using the music player’s “shuffle mode.”
Spotify is now available in a number of countries. The top countries include Sweden, Norway, Finland, Ireland, Switzerland, and Denmark. Streaming is also available in Japan, Iceland, France, Philippines, Hong Kong, Vietnam, Indonesia, Malaysia, Taiwan, South Korea, and Turkey.
However, pricing varies widely across the world. For example, Premium costs a lot less in Asia and Africa. On the other hand, it costs the most in the Scandinavian countries.
Spotify has a family plan that makes Premium access cheaper for bigger families. In some countries, Spotify is also available in the free version. In India, Premium costs 80% less than Spotify Premium in the United States. In Turkey, Premium costs 17 Turkish liras. In Indonesia, Premium costs 3.45 US dollars. In Ukraine, Premium costs 141 Ukrainian hryvnias.
In Brazil, Spotify is the leading streaming service. However, it has lost its parity with Apple Music, which pays more per stream. Spotify has also complained that its ARPU has declined. However, its music distributors are reporting higher payments to songwriters. This crediting is a positive development for songwriters.
Spotify is also expanding into emerging markets. It’s available in five African countries. However, in the French market, streaming hasn’t been included in the SNEP albums chart.
The company has negotiated license deals for a number of countries, including Brazil, Argentina, and Sweden. It’s currently in the middle of a round of contract renewals with major labels. This will allow Spotify to focus on other revenue-generating sources.
Spotify’s prices are currently increasing in some markets. The company is also testing premium pricing in Scandinavia. However, it hasn’t provided details on how it plans to price its service in more than 42 markets.
Pricing in Latin America
During Spotify’s Investor Day, CEO Daniel Norstrom shared his vision for the company’s future and identified Latin America as a promising market for growth. He also identified Asia and Africa, both of which are emerging markets, as key areas of growth. While Norstrom did not offer a clear picture of Spotify’s position in these markets, he did discuss how his company will be working with local partners to expand its catalog and introduce podcasts to these markets.
In Europe, Spotify has 40 million users, and it’s predicted to have 121 million users by 2021. In North America, the company has 36 million users, and it’s expected to have 85 million users by 2021. The company plans to expand to more than 180 markets worldwide, and it is planning to enter the U.S. and South America in the next few years.
While the company’s growth in LatAm has been explosive, its user growth has not kept pace with its revenue growth in the region. According to IFPI’s Global Music Report, LatAm will grow by 31.2% in 2021, but the company’s YoY MAU growth in the region will fall significantly.
Despite the decline in user growth in LatAm, the company is planning to expand into more than 180 markets worldwide. Those markets include Argentina, Chile, Ecuador, Guatemala, Mexico, Nicaragua, Peru, Uruguay, and Venezuela. Those countries will all be eligible to receive a Premium Duo plan, which is designed for couples. The company first introduced the plan in Chile and Colombia, and it is now being rolled out to 14 additional Latin American markets.
The Premium Duo plan offers the same benefits as the Spotify Premium Subscription, but it also offers no additional fees on songs, no interruptions, and the service can be used on a variety of devices. In most markets, Spotify will also launch with a full podcast catalog. Its catalog is limited to licensed rights, but the company said it will work with local partners to introduce more podcasts to these markets.
In addition to Spotify, Qobuz is also expanding to six additional countries in Latin America, including Chile, Colombia, Guatemala, Mexico, Peru, and Uruguay. Qobuz now has a presence in 25 countries, and it competes with Apple Music, YouTube Music, and Amazon Music.
