Spotify Technology plans to increase the price of its plans by about $1 to $2 per month in five markets, including the UK, Australia and Pakistan, by the end of April. Bloomberg News reported This was disclosed on Wednesday, citing a person familiar with the matter.
Shares in the Swedish music streaming service, which competes with rivals from Apple and Amazon, rose more than 5% on Wednesday.
Spotify plans to raise prices in its largest territory, the United States, later this year, according to reports.
The company also plans to introduce a new base tier that will offer music and podcasts, but not audiobooks, on its current $11 per month individual premium plan, the report said.
The new basic tier is the first of several new pricing options that Spotify will offer, the report added.
According to a report from Bloomberg, the new pricing plans will increase prices by about $1 a month for individual plans, and $2 a month for family plans and so-called duo plans for couples.
According to the company’s website, the company offers premium plans in the U.S. that include $10.99 for individuals, $14.99 for duos, and $16.99 for families on a monthly basis.
Spotify declined to comment on this report.
CEO Daniel Ek said in early February that the company “has a lot of levers to pull from, including price increases,” adding that its investment in podcasts would be a drag on its business in 2023.
The company offers a free service with limited functionality and advertising, and a paid subscription-based service with access to all features, with premium subscribers making up most of its revenue.
A potential price increase could help boost profitability for the company, which is expected to see strong subscriber growth.
Spotify said in February that it expected its premium membership numbers to rise nearly 14% to 239 million in the current quarter, which was higher than the 238.3 million expected.
The company introduced services such as podcasts and audiobooks to reduce its dependence on the music industry and reach more users.
The company has content licensing agreements with companies such as Universal Music Group, Sony Music Entertainment, and Warner Music Group, and as of December 31, these companies accounted for approximately 74% of the audio content streamed on Spotify’s platform. The content is dominated by
