Spotify increases price of Family Plan subscription in Australia

Spotify has increased the price of its Family Plan in Australia from AUS $17.99 to AUS $18.99 (approximately US $13.69), effective October 1 for new subscribers.

The change for existing Family Plan subscribers will reportedly come into effect after their individual billing date in November.

Launched in 2016, Spotify’s Premium Family Plan allows subscribers to add up to six individuals to their account.

We’ve written previously about how Spotify doesn’t exactly love suggestions that it should raise its subscription prices, despite of this being one way to curb declines in ARPU – the average revenue paid each month by its Premium subscribers around the world.

The subtle price increase in Australia this month will likely be seen as a positive sign for investors and rightsholders of further price rises in future.

“To continue offering a unique service, we increased the price of Spotify Premium Family for new users in Australia from $17.99 to $18.99 on October 1.”

Spotify spokesperson

Referring to the Australia price rise, a Spotify spokesperson said the streaming service’s “pricing varies across regions, reflecting local macroeconomic factors, as well as our commitment to bringing both the best audio content and the highest value to our subscribers with much more to come in the future.

They added: “To continue offering a unique service, we increased the price of Spotify Premium Family for new users in Australia from $17.99 to $18.99 on October 1.

“Existing subscribers have a one month grace period and will see the price change on their next billing cycle after November 1.”

Spotify’s Premium monthly ARPU fell by 7% at constant currency, year-on-year, to €4.42 in Q1 2020.

We noted at the time that this decline marked the first time ever that Spotify’s official ARPU had fallen to less than half the company’s standard €9.99-per-month subscription price.

Spotify’s new Australian pricing for a Family Plan subscription

In April, when SPOT boss Daniel Ek was asked on the company’s Q1 2020 earnings call if Spotify might consider changing its standard pricing in the “upcoming months and years”, he said: “No, again, our primary strategy is growth”.

Added Ek: “As we said before, rather than maximizing revenue [we are focused on] this amazing opportunity of moving [people] from radio to on-demand audio; that’s the trend line that we’re trying to capture and that’s what you’re seeing us go after.

“We have made small pricing experiments in some of our more mature markets and obviously due to inflation you’ve seen us adjust pricing in some [other] territories too. The response from those have been very positive, but it’s not something that we’re focusing on in the short term.

“[However], it’s definitely encouraging to see that we have that opportunity for when the economy improves, and we feel that’s the right trade off to make.”

One of those markets to see a pricing experiment was in Norway in July 2018, where SPOT’s standard Premium, student and Family Plans were increased by 10% and have actually remained 10% higher ever since.Music Business Worldwide

Related Posts