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Last year’s price hikes for streaming services has seen UK streaming subscription revenues grow healthily but how much can consumers afford?

Last year saw music streaming services raise subscription costs. Across the board, services responded to inflation and the necessity of earning a profit with increased monthly charges for users in 2023.

The result of these price hikes has been a 10% rise in UK subscription revenue. During 2023, UK subscription revenues rose to £1.87 billion ($2.37 billion) – according to data released by ERA to Digital Music News.

Spotify, Apple Music, and Amazon Music all raised their charges to £10.99 a month for individual UK plans. Deezer have controversially struck ahead with a premium of £11.99 a month.

These price rises have been great for the industry, but of course it comes at a cost to the consumer. Industry professional Jay Gilbert predicts that more price rises will come in 2024, with the average single-user monthly rate in the US raising to $12.99 (it currently remains at $10.99).

In a cost-of-living crisis, how many users will be able to keep up if subscription prices keep raising? Streaming subscription costs rose nearly 3x higher than inflation in the UK last year. It seems that access to music is still important enough to justify paying more.

Spotify’s third quarter earning report last year followed the price rises in countries around the world. The report showed that the music streaming service was still growing considerably from year to year. There may be a ceiling in which users start to drop off if price rises continue to outpace inflation, but we haven’t reached it yet.

Spotify have been expanding their offerings with recent additions including free audiobook listens and an AI DJ. Enhancing their Premium offerings makes their service more enticing but they themselves add extra cost to Spotify’s service.

Overall, the UK music market had a record breaking year in 2023. Revenues continued their steep rise powered largely by the music streaming industry. However, industry figures warn not to get comfortable, reiterating that many in the UK industry aren’t earning sufficient amounts whilst many venues are struggling to stay open.