Topline
Spotify is reportedly planning to add a more expensive subscription option that will include high-fidelity audio later this year, as entertainment companies diversify subscription options in an effort to increase revenue.
Spotify plans to offer a new subscription option that will include HiFi—a high quality audio—to … [+]
Key Facts
The new subscription option, called “Supremium” internally, will offer a HiFi—a high quality audio—to subscribers who are willing to pay more, people familiar with the matter told Bloomberg.
“Supremium” will launch later this year in non-U.S. markets first, Bloomberg reported.
Both Apple Music and Amazon Music currently offer HiFi for free as part of their standard subscriptions plans.
Additionally in October, Spotify reportedly plans to shift its current model of selling audiobook titles individually to an expanded audiobook access model in the U.S., by shifting its current “premium” subscriber tier to offer either a specific number of titles or a specific number of free hours per month.
Tangent
Spotify initially announced it was working on a HiFi feature in 2021 through a video featuring music artists and siblings Billie Eilish and Finneas explaining why HiFi audio matters. Finneas said there’s moments in the music that artists create, like Eilish chuckling in the background of a song, that can only be heard in high quality audio. Eilish said it’s crucial for people to hear her music in high quality audio, “it is really important because we make music that wants to be heard the way it was made,” she said.
Key Background
The announcement comes as Spotify works to increase revenue and stay competitive with Apple and Amazon’s music streaming options. Currently, Spotify is one dollar cheaper a month than its competitors, charging customers $9.99 for the Premium plan. Spotify also offers a free version of the app with ads. But since the music streaming platform has not raised its prices for U.S. subscribers, the company has resorted to other ways to save money and stay afloat during trying economic times. Since the beginning of the year, the company has implemented two rounds of layoffs. In January CEO Daniel Ek said the company would cut 6% of jobs, representing about 600 workers, to control costs “in a challenging economic environment.” Another 2% of the workforce, about 200 employees, were cut at the beginning of June. And Ek has not totally ruled out a cost increase for U.S. subscribers as another method to increase revenue. During the company’s Q1 earnings call in April, Ek said the company would like to raise prices in 2023, “when the timing is right.”
Further Reading
Spotify Plans New Premium Tier, Expected to Include HiFi Audio (Bloomberg)
Source: https://www.forbes.com/sites/anafaguy/2023/06/20/spotify-will-reportedly-launch-pricier-subscription-tier-later-this-year/