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Spotify (New York Stock Exchange: POINT) revealed additional subscription plans on Friday as the music streaming service differentiates itself from its competitors through its audiobook offerings.
Spotify has introduced Basic and Premium plans, with the Premium plan offering 15 hours of audiobook listening per month. from a catalog of more than 250,000 titles as well as unlimited music without advertising.
The price difference is minimal, being $11.99 per month for individual Premium and $10.99 per month for Basic. Spotify now also offers an audiobook plan, offering 15 hours of ad-supported listening to audiobooks and music for $9.99 a month.
Music streaming subscription plans offered by Spotify, Apple (AAPL) Music, amazon (AMZN) Music Unlimited, and Google (GOOG)(GOOGL) YouTube Music are priced fairly similarly.
They offer student plans ranging from $5.49 to $5.99 per month, individual plans cost around $10.99 per month, and family plans range from $16.99 to $19.99 per month.
However, amazon Music Unlimited offers a slightly cheaper individual plan at $9.99 per month and a single device plan at $5.99 per month.
Even though Spotify's plans cost a little more than other music streaming services, the Sweden-based company continues to grow its subscription base.
Its most recent financial results included a 23% year-over-year increase in monthly active users and a 14% increase in subscribers.
“The company has implemented strategic pricing adjustments to increase revenue without deterring new subscriptions, demonstrating strong pricing power,” said Noah's Arc Capital Management, an analyst and Looking Alpha contributor. “Despite challenges in maintaining profitability, Spotify's price increases and user engagement strategies are expected to sustain growth and improve profitability in the future.”
Spotify dominates the other major music streaming services with around 31% of global market share, according to Statista, which is only slightly less than Apple Music, amazon and YouTube Music combined.
Spotify's massive user base of 615 million monthly active users and nearly 300 million subscribers is sustained through its multiple offerings, including music, podcasts and audiobooks.
Analysts are mostly bullish on Spotify as it has a Buy rating from both Seeking Alpha and Wall Street analysts. It has a Strong Buy rating from Looking Alpha's Quant system, which routinely outperforms the market.
The price of its shares has increased by 70% year to date and more than doubled in the last 12 months.
