this post was submitted on 22 Jul 2023
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What improvement in service does the hike reflect?
$10 in 2011 would be $13.56 today.
Source: https://www.in2013dollars.com/us/inflation/2011?amount=10
Per the article, the service hasn't changed in price in 12 years, while the platform has certainly received a decent number of updates, new features, new artists, etc.
If it isn't worth $11/month to you, don't pay it? But it doesn't seem right to insinuate that they're doing something outrageous by raising prices once in 12 years?
Streaming services have an enormous amount of fixed costs. It might cost them several billion dollars/year to operate the necessary infrastructure even with zero customers, but the marginal cost to serve a customer might be on the order of $2/month on that $10/month subscription.
It's why streaming and digital storefronts are such a sink/swim industry. Either a company gets over user number+sales threshold to override their fixed costs, upon which they become profitable and all further growth makes them exceedingly profitable. Or the company fails to do so or barely does so, and makes somewhere between giant losses to minimal profits.
From a quick search, Spotify's user count should have grown somewhere in the neighborhood of ten times over since 2015.
This is not a cost increase that is mandated or justified by inflation. It never is. It's a cost increase from a very, very, very simple fact: companies want profit, and Spotify's leadership has concluded that they will gain more profit by increasing prices than they will by not doing so.
To quote my insurance company when I asked why my rates went up, "well, everything is costs more. Other places are charging more too."
This seems like a similar situation.