Few U.S. Spotify Subscribers Have Opted Out of Higher-Priced Music-Audiobook Bundle, Survey Finds
Written by djfrosty on January 13, 2025
Spotify’s less expensive subscription plans that exclude audiobook listening have been adopted by about 14% of its U.S. subscribers, according to a new Morgan Stanley survey.
In June, Spotify allowed existing subscribers to opt into “basic” plans without free audiobook listening in exchange for a slightly lower price. The basic plans arose from Spotify’s decision to bundle 15 hours per month of audiobook streaming with the standard premium subscription plans. Around the same time, the company increased the monthly premium subscription fee in the U.S. to $11.99 for individual plans and $19.99 for family plans that allow up to six people per account. The basic tiers provide access to music and podcasts while allowing subscribers to opt out of the audiobook offering.
So far, not many Spotify subscribers are opting for the music- and podcast-only tier. Morgan Stanley’s 11th annual Audio Entertainment Survey found that in 2024, 17% of U.S. individual premium subscribers opted into the less expensive basic plan, while 10% of family plan subscribers chose the less expensive basic tier. While the premium family plan’s percentage of all subscribers dropped only slightly to 25% from 26%, the premium individual plan’s share of subscribers fell to 48% in 2024 from 61% in 2023.
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The basic tiers’ light adoption rates help shed some light on the financial impact of Spotify’s decision to pay a lower mechanical royalty allowed for bundled digital services. In May, Billboard estimated that Spotify would pay $150 million less to songwriters, publishers and PROs in 2024 than they would have if Spotify had not bundled music and podcasts with audiobooks in the premium plans. (That estimate was calculated before Spotify raised premium rates again in June and gave subscribers the option to pay a lower rate for a plan that excludes audiobooks.) Less than a fifth of subscribers have opted for the basic plan, meaning the lower royalty rate of the music-audiobook bundle still applies to the vast majority of subscriptions.
The cost of the premium tier appears to have had a slight impact on consumer sentiment, however. The introduction of the basic plan and the second price increase in as many years coincided with a decline in Spotify’s user satisfaction. The survey found that the percentage of Spotify users who are “very satisfied” with the service slipped to 57% in 2024 from 61% in 2023, while “somewhat satisfied” users increased to 29% from 26%. Among streaming services, YouTube Premium was No. 1 in user satisfaction with 87% of respondents either “very satisfied” or “somewhat satisfied” with the premium video platform. Spotify, last year’s No. 1, was No. 2, followed by SiriusXM at No. 3, YouTube Music at No. 4 and YouTube at No. 5. Apple Music had the biggest decline, dropping from No. 2 in 2023 to No. 7 in 2024. Tidal ranked last in user satisfaction with 80% of users either “satisfied” or “somewhat satisfied” with the service.
Spotify fared well among young consumers. Overall, the platform accounted for 11% of listening time, third behind AM/FM radio’s 25% and SiriusXM’s 12%. But amongst the 18-29 age group, Spotify dominated with 19% of listening time, well ahead of YouTube and AM/FM radio’s 13% shares a piece and SiriusXM and Apple Music’s 9% shares a piece.
Spotify ranked behind only AM/FM radio in terms of U.S. active users. The survey puts U.S. AM/FM listenership at 316 million, about triple Spotify’s 106 million (including both subscribers and free users). Pandora ranked No. 3 with 44 million active users, ahead of Apple Music’s 41 million and SiriusXM’s 38 million. Amazon Music was estimated to have 13 million active users.