Spotify's Basic Plan Exists — But New Users Can't Actually Subscribe to It
Spotify's new unbundled 'Basic' subscription plan faces scrutiny over its accessibility and visibility to potential subscribers. Here's what you need to know:
Key Facts About Spotify Basic:
- Only available to existing subscribers
- Not accessible to new subscribers
- Can be accessed by downgrading from Family and Duo Premium plans
- Existing subscribers were notified via email about the option
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Why This Matters:
- Spotify has moved 98% of its plans into bundles
- Bundled plans are more profitable for Spotify
- Bundled plans result in lower royalty payments to artists
- New subscribers must choose bundled options
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Industry Response:
- Music publishers criticize Spotify's bundling strategy
- The Mechanical Licensing Collective has filed a lawsuit
- NMPA (National Music Publishers' Association) is pushing for legislative changes
- Publishers question potential infringement related to lyrics, music videos, and podcasting
Possible Motivations:
- Basic tier may serve as defense against criticism
- Allows Spotify to claim market choice
- Helps counter accusations of forced bundling
- Could mitigate legal and regulatory pressures
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Financial Impact:
- Bundled offerings have resulted in significant royalty savings
- Spotify reports $100 million in royalty savings since March
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This ongoing situation highlights the tension between streaming platforms' profitability and fair compensation for artists, while raising questions about consumer choice and transparency in subscription offerings.