Spotify Premium users beware: you’ll need to start paying more every month for your subscription soon.
Earlier this month, the streaming service announced it would increase the monthly fee for its four premium plans starting in December. The raise in prices range from as low as 40 cents to $4:
- Student: $6.39/month (up from $5.99/month)
- Individual: $12.69/month (up from $10.99/month)
- Duo: $17.89/month (up from $14.99/month)
- Family: $20.99/month (up from $16.99/month)
Amid the online fury over Spotify’s plans, the company said in a statement to the Star that new federal regulations under the Online Streaming Act are one of the reasons for the higher fees, along with “local macroeconomic factors” and market demands.
Here’s a quick explainer for those wondering why a random government bill is being blamed for how much they pay for music.
What is the Online Streaming Act, and what does it have to do with my Spotify fee?
The Online Streaming Act, also known as Bill C-11, was passed by the federal government in April 2023 to require streaming platforms to contribute and support Canadian content, something that traditional broadcasters (think TV and radio) are already required to do under the 1991 Broadcasting Act, sometimes referred to as CanCon.
Over a year later, in June, the Canadian Radio-television and Telecommunications Commission (CRTC) — an independent regulator of Canadian broadcasting — announced that it would require foreign streamers to pay five per cent of their annual Canadian revenues into a fund aimed at producing local programming, Indigenous news, French-language content and content created by those with a diverse background.
While the local media industry has praised the mandate, associations representing Spotify and other big streaming services like Netflix have come out against the CRTC’s announcement.
The Motion Picture Association Canada — which represents platforms including Disney Plus, Netflix, HAYU, Sony’s Crunchyroll, Paramount Plus and Pluto TV — said the decision does not take into account the contributions already made by its members to the Canadian media industry, according to reporting from The Canadian Press in June.
And, at the end of September, the Digital Media Association (DIMA), which Spotify is a part of, launched a national campaign against the mandate, calling it a “streaming tax” that could increase costs for consumers. The campaign is asking Canadians to send messages to their MPs to repeal the tax.
“The streaming tax needs to be scrapped because Canadians are already feeling the pinch from rising inflation and economic pressures. The addition of a streaming tax is an unnecessary burden,” Graham Davies, president and CEO of DIMA, said in a statement at the time of the campaign’s launch.
In its statement, Spotify said it has filed a legal challenge against the “CRTC streaming tax” along with “a number of others,” but that it wouldn’t comment any further at this time.
The CRTC did not respond to the Star’s request for comment before publication time.
Brett Caraway, an associate professor in media and economics at University of Toronto Mississauga, pushed back against Spotify blaming the new CRTC mandate. While consumers do bear some of the burden from new taxes, he said producers are also responsible.
“Who bears the bigger brunt is kind of a function of how responsive producers and consumers are to change its price,” he explained.
Caraway also pointed out that the price for an individual Premium plan is going up around 15 per cent, more than what Spotify is being required to pay under the CRTC mandate.
“There’s obviously more going on than just this one added cost.”
Will all my friends stop using Spotify now?
You shouldn’t expect people to end their Spotify Premium plans en masse, according to Caraway.
“Music is so important, you can increase a couple of dollars and people will continue to pay that price and maybe give up something else,” he said.
Still, Caraway acknowledged that those with a lower income may be more impacted by the higher prices — especially when added on top of other streaming platform subscription fees.
Are other streaming services upping their prices?
Spotify seems to be the first streaming platform to up their prices from the CRTC’s new regulations so far.
“It would not surprise me to see other platforms follow suit,” Caraway warned.
Once Spotify’s prices rise in December, it’ll be one of the pricier options for people looking for a music streaming service. Here’s what other platforms with similar services are charging, as of Oct. 16:
Apple Music
- Students: $5.99/month for students
- Individual: $10.99/month
- Family: $16.99/month
Amazon Music Unlimited
- Prime members: $9.99/month, as part of their monthly Prime fee that includes faster delivery times and movie/TV streaming
- Non-Prime members: $10.99
Tidal
- Students: $5.49/month, with an option to pay $9 more for a DJ extension plan that allows users to access Tidal on DJ equipment;
- Individuals: $10.99/month for individual, also with an option to pay $9 for the DJ extension plan
- Family: $16.99/month
YouTube Premium
- Students: $7.99/month
- Individual: $12.99/month or $129.99/year
- Family: $22.99/month
With files from The Canadian Press
