The Financial Times says Spotify is planning to raise US subscription prices in the first quarter (Q1) of 2026. It's only a matter of time before the change comes into effect. Get your money ready.
Blame Spotify's success for its price hike
Spotify wants to prove sustained profitability. Hence, the reason you'll pay extra for its music streaming services next year. Wall Street has been watching them like a hawk since their stock jumped.
Apparently, analysts have been begging for a US price hike. This is the move that will make investors breathe a sigh of relief. For more context, the company is going through a major leadership change where Daniel Ek, the founder, is stepping down as CEO.
Ek co-founded Spotify in 2006 and has since been running the company from the very beginning. You could say he's been CEO for almost twenty years. Now, two new leaders will take over early next year.
The stock increase is part of what Spotify needs to convince investors that they can keep making money for years. They live for predictable growth and revenue. At the same time, price increases boost the company's earnings. Even if no new person signs up, the platform will still earn more money each month from people already paying.
Meanwhile, Spotify has been raising prices in the UK, Australia, and Switzerland these past few months. I guess it's America’s turn for the first time since July 2024. A US subscription is $12 today, which is barely $2 more than it was 14 years ago. Specifically, $10.
Is Spotify worth an extra dollar from your wallet?
Investors are not the only ones clamouring for a Spotify price hike. Record labels are asking for it too. Given that songs belong to them and Spotify owes them a percentage of the revenue for hosting them, the platform cannot survive without label approval. The obvious consequence is that major labels will pull their catalogs.
Recall how earlier in 2024, Universal Music Group (UMG), the biggest record label in the world, pulled all its music from TikTok. Both companies failed to agree on licensing fees and payments for artists.
Overnight, TikTok lost access to millions of songs from Taylor Swift, Drake, Burna Boy, and Ariana Grande to smaller artists signed under the label. What is TikTok without the sounds that fuel its trends, dances, memes, and virality?
Spotify hasn't given an official reply to confirm these changes. But the most important thing to understand is that it isn't personal.
Use that time to reflect on how much value you’re currently getting from the streaming platform. Unfortunately, the Student plan at $5 is the only other affordable plan you can fall back on if you’re trying to save money. You might consider whether you want to stay on the same plan or try alternative services with cheaper plans.
If you're deeply tied into your playlists, Wrapped, or recommendations, the convenience might make the service worth paying the extra money.
