Spotify has notified customers in Canada that it will be increasing its subscription prices in the market.
The news arrives amid a debate in the market over a proposed tax on non-Canadian streaming companies’ domestic revenues.
In June, Canada’s telecom regulator, the CRTC, announced that starting this fall, non-Canadian streaming services will be required to pay a 5% tax on their Canadian revenues, which will be put into a number of different funds that support Canadian music creators and broadcasters.
The price hikes reportedly affect all Spotify Premium plans in Canada. According to local news outlet iPhoneinCanada.ca, Spotify’s Individual plan has increased by 15% to CAD $12.69 per month from $10.99. The Student plan saw a 5% increase to CAD $6.39 from $5.99. The Duo plan jumped 19% to CAD $17.89 from $14.99, while the Family plan experienced the most significant increase of 24%, rising to CAD $20.99 per month from $16.99.
In Spotify’s emails to customers that the news outlet obtained, the company said it is increasing the prices of its Premium Individual tier “so that we can continue to innovate on our product offerings and features.” The company also noted that users have the option to downgrade or cancel their subscription if they’re dissatisfied with the new pricing, according to the report.
This price adjustment in Canada follows a similar increase in the US in June. At the time, Spotify said the move would allow it to “continue to invest in and innovate on our product features.”
The most recent price hike in Canada was in July of last year.
A Spotify spokesperson confirmed the Premium price increase in Canada in a statement issued to MBW.
Said the spokesperson: “As we continue to innovate and invest in providing our listeners with greater value than ever before, we occasionally update our prices.
“We may also adjust our prices to reflect local macroeconomic factors and meet market demands while offering an unparalleled service.
“We, along with a number of others, have filed a legal challenge against the CRTC streaming tax in Canada, and so will not be commenting further publicly at this time.
“As we continue to innovate and invest in providing our listeners with greater value than ever before, we occasionally update our prices. We may also adjust our prices to reflect local macroeconomic factors and meet market demands while offering an unparalleled service.”
Spotify Spokesperson
In June, the Canadian Radio-television and Telecommunications Commission (CRTC) announced that starting this fall, music streaming services that are not affiliated with a Canadian broadcaster and who earn at least $25 million in revenue in Canada are subject to a 5% tax on their Canadian revenue, which will then be put into a number of different funds that support Canadian music creators and broadcasters.
The potential for price increases due to these new regulations was foreshadowed by industry representatives. In testimony before the CRTC about a year ago, Olivia Regnier, a senior Spotify executive, warned that imposing additional costs on the streaming company “will force us to make unavoidable choices to maintain our financial viability. They could force us to cut costs … or even increase our prices for Canadian consumers.”
Last week, the Digital Media Association (DiMA), which represents Spotify, Amazon Music and Apple Music, wrote an open letter to the CRTC, urging it not to regulate streaming as if it were radio. “We write to you today to reinforce an important message shared throughout the consultations: radio and audio streaming are not the same,” the letter read.
Amazon, Apple, and Spotify already lodged a legal challenge against the proposed streaming levy in July, requesting a judicial review of the new regulation.
This is not the first time Spotify has adjusted its pricing in response to government regulations. In March, the company raised prices for subscribers in France following the introduction of a tax aimed at supporting the domestic music sector. Spotify had also threatened to disinvent in France and pulled support for two music festivals in a sign of protest.
MBW has contacted Spotify for additional comment on the recent price changes.
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