Streaming could change significantly not too far into the future.
Recent price hikes for existing Spotify tiers are not slowing down the idea of the High-Fidelity step the music streaming giant has been planning for a while, according to a Bloomberg report. In their eyes, there is a dedicated segment of their customers who would be willing to pay more for better quality content and additional tools.
While Spotify declined to comment on specifics, the report suggests this new potential tier would incur an additional monthly cost of at least $5 compared to the current premium plan. Details regarding the nature of the “additional playlisting tools” — one of the stronger points rumoured as exclusive benefits of this “Supremium” subscription — remain undisclosed, with a representative for the firm closing the door shut, “We don’t comment on speculation around possible new features“.
Is Streaming Changing For Good?
This tier signifies a strategic pivot for Spotify — and perhaps all streaming platforms. The traditional flat-fee model, where users gain access to the entire library for a single price, faces increasing scrutiny from artists and rightsholders. They argue that this approach limits potential revenue, particularly from dedicated fans who consume a significant amount of content. Apparently, there are better ways to earn revenue for the artists, the labels, the streaming services, and everyone else involved. Or so they claim.
Offering a tempting higher subscription could be the answer to the slow growth of streaming in major markets nearing subscription saturation. What does that mean? Put simply with an example, Bloomberg reports the U.S., a country of 127 million households, has a 12-month average of 96.8 million on-demand subscriptions. There’s not a lot of room left for new buyers to enter, and these subscriptions account for a large percentage of record labels’ income. The site claims paid subscriptions accounted for 79.4% of label growth in 2023.
Once beta testing of this tier enters the larger markets in the world, we’ll see if things go according to Spotify’s reports and predictions, or if it all backfires, in the event of users leaving the platform after seeing some features — or potentially songs — hidden under an extra dollar sign.
[H/T] Billboard
