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Spotify now has 678 million monthly active users, adding five million net subscribers for 12% year-over-year growth, reaching 268 million paying customers. Despite that ‘record subscriber growth’ Daniel Ek didn’t have much to say in the way of when investors can expect the new super-premium tier to drop. That reticence to launch seems due to a variety of factors, from licensing complexities, competitive landscape shifts, and feature development challenges.
A recent survey suggests only 45% of Spotify users would be interested in a higher-priced tier, meaning Spotify needs to add value for the tier to be attractive to users. The company may also have delayed the launch due to macroeconomic conditions, which have seen consumers tighten their belts where extraneous subscriptions are concerned. Nevertheless, when asked directly about the new tier, Daniel Ek spun a giant word salad.
Alex Nordstrom, Co-President & Chief Business Officer at Spotify, jumped in to answer before Daniel Ek could take the lead. “With regards to higher tiers, we see great potential in them as we’ve mentioned before. So creating higher tiers around new offerings is something we are working towards as it really opens up new opportunities to delight users. And of course we need alignment and support from our industry partners to offer these kinds of new experiences to our users. I think it’s also worth noting that we will continue to look for new ways to invest in our premium offering as we have done all along.”
Daniel Ek jumps in at this point, stating, “If you sort of look at the overall picture, Spotify is now a quite sizable business, but also a sizable platform. And typically, what’s interesting is that we’ve kind of gotten here pretty much with just the same freemium model that we launched and started working on now 19 years ago.”
“And so what naturally happens as the market evolves is that you typically end up segmenting the market, and that’s always been a very good business strategy—we’re just in the early innings of doing that here.”
“But for the very, very long-term, it is an upside opportunity for Spotify, but I think one where, if I look at it from a music industry standpoint, this is, this is a huge part of the music industry. But for the near term, the way to think about it for Spotify is we’re not dependent on that for growth, but we want to make it happen.”
“So this is really one where I would put, again, the emphasis is for the superfan, we do need the partners to come to the table and be a part of this journey.”
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Spotify CEO Spins Word Salad When Asked About ‘Super-Premium’ Launch—Is This Thing Still Happening? – Digital Music News
