Photo Credit: Spotify
Ready for a more expensive “Spotify Deluxe” subscription option? Daniel Ek certainly is, and according to the Spotify CEO, the potentially $18-per-month package is on the way.
Ek confirmed as much during Spotify’s second-quarter earnings call yesterday, when the business shed light on its best-ever quarterly profit and forecasted topping a quarter of a billion global subscribers in Q3.
In keeping with prior quarters’ results, the lion’s share of Spotify’s $4.13 billion (€3.81 billion) in Q2 revenue derived from subscriptions. And that category continues to benefit (at least in revenue per paid account) from price increases, which have, among other things, placed the monthly cost of Spotify’s Individual audiobook-equipped tier above its Apple Music counterpart in the States.
Of course, only time will reveal the long-term effects of charging more than competitors for largely overlapping products in a difficult economy. Keeping the focus on the top level and the present, however, Spotify reported adding seven million subscribers and generating $3.64 billion (€3.35 billion) from paid accounts during the second quarter.
Evidently eager to keep the momentum going, boost ARPU, and stand out from the highly competitive streaming crowd, Spotify is teeing up a Deluxe package, per Ek’s initially mentioned remarks.
“We have expanded our subscription offerings to consumers who might be looking for different types of content,” the 41-year-old said. “By introducing new subscription plans, we are successfully giving subscribers even more listening choices.”
Later in the call, the Stockholm native acknowledged Spotify Deluxe – albeit without disclosing the precise contents or released date thereof.
“What we do see is that there’s a good subset of that group now – we’re at 246 million subscribers – that want a much better version of Spotify,” continued Ek. “Those are huge music lovers who are primarily looking for even more flexibility in how they use Spotify and the music capabilities that exist on Spotify. … The plan here is to offer a much better version of Spotify.
“So think something that could be $5 above the current Premium tier; it’s probably around a $17 or $18 price point. But sort of a deluxe version of Spotify that has all of the benefits that the normal Spotify version has but a lot more control, a lot higher quality across the board, and some other things that I’m not ready to talk about just yet,” he concluded, later noting that the corresponding plans are in their “early days.”
While fans who have for years been awaiting HD audio might take issue with the “early days” description, we now have direct evidence of Spotify’s upgraded-tier ambitions. Higher-quality listening will presumably be part of that package, which has itself been rumored for some time.
Those rumors, attributable to anonymous sources as well as verified Spotify code and feature tests, have also pointed to robust mixing tools, bolstered playlist capabilities, and expanded audiobook access. Given the varied offerings of competitors like Apple Music and Amazon Music, both of which embraced HD audio at no added cost years back, it’ll be worth monitoring the commercial results of Spotify Deluxe when it finally arrives on the scene.
