Spotify Testing Price Hike Across Scandinavia

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Spotify will test a more expensive version of its family plan in Scandinavia, sources close to the company tell Billboard. The news was first reported by Bloomberg. Spotify is planning to increase the price of its family plan by nearly 14% in Norway, Sweden, and Finland according to Bloomberg, but sources say this is a test case and there are no current plans to arbitrarily raise prices in other regions. This is the second time Spotify has tested price increases in Scandinvia -- last year the company raised prices by 10% in a test in Norway. Spotify declined to comment.

The Swedish streaming service has been looking for ways to increase its revenue and turn a profit since going public early last year, spending heavily on podcasts which CEO Daniel Ek thinks could attract up to 20 percent of time spent on the platform.

"We have the opportunity to make original content the way Netflix does and to utilize the catalog content we have in the platform to help bring people to the podcast space," Dawn Ostroff, Spotify's chief content officer, told the Seattle Times last year.

But the one aspect missing from Spotify's mirroring of Netflix's strategy is price increases. Netflix has raised its prices or offered a more expensive tier of service four times in the last five years, while Spotify has never officially raised its prices.

The argument against Spotify replicating Netflix's price hikes is the makeup of its content: Netflix has movies and shows that you can't find elsewhere, but nearly all of the music on Spotify is available on every other streaming service. Raising prices when your two biggest competitors -- Apple and Amazon -- offer the same product and would likely advertise against Spotify is far more challenging. But if exclusive podcasts take off for Spotify, and it does eventually command 20 percent of listening time, the company will have something that the competition can't offer, and that may be worth a few more dollars a month.


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