Spotify CEO Announces New Subscription Plans as Platform Revamps Value Pricing Strategy
Spotify CEO Daniel Ek has announced plans to expand the platform's subscription options and bundles as part of a strategy to optimize its value-to-price ratio. This development comes amid industry controversy over the company's recent pricing changes and audiobook integration.
Spotify logo on white background
Ek explained that Spotify's approach focuses on balancing value delivery with market-appropriate pricing. The company plans to enhance both its base tier offerings and expand consumer choice through various subscription options.
The evolution of Spotify's subscription model has progressed from single-person plans to include:
- Family plans
- Duo subscriptions
- Regional payment options (including day and week passes in Southeast Asia)
- Upcoming audiobook-only tier
- Planned music-only tier
However, this strategy has met resistance from the National Music Publishers Association (NMPA). David Israelite, NMPA's President and CEO, strongly criticized Spotify's audiobook-only option, viewing it as an attempt to reduce songwriter payments through service reclassification.
The conflict centers around mechanical licensing rates, which were set at 15.35% for 2023-2027 in a 2022 settlement. Israelite characterized Spotify's bundling approach as "cynical and potentially unlawful," suggesting potential legal action against the streaming platform.
NMPA music bundling image
Man wearing green shirt at screen