Senators urge FTC to investigate Spotify’s higher priced bundled subscriptions

The two U.S. senators have requested that the Federal Trade Commission (FTC) investigate Spotify on allegations that it had combined music streaming and audiobook services into more expensive subscriptions without user consent, while also reducing royalty payments to creators in the process.

On Friday, June 20th, US Senators Marsha Blackburn and Ben Railhan I wrote a letter Claims to FTC that Spotify converted its standard premium subscription to a high-cost bundled subscription without notifying consumers. They also emphasized that there is US regulations Allows digital music providers to reduce the royalty rate of your music if your subscription is bundled with other legitimate products.

“Spotify’s intention seems clear: to reduce the legal loyalty we pay to songwriters and music publishers. Not only has this hurt our creative community, but this action has hurt consumers,” the letter said.

last year, Mechanical License Group (MLC) sued Spotify, allegedly underestimating songwriters and publishers, but the lawsuit was dismissed in January.

In March 2024, Spotify rebuilt the Premium Tier, increasing it to $12 for individuals and $20 for families, including a 15-hour audiobook. Users must manually opt out of the plan.

The change reportedly lost $230 million in its first year. Daniel AguirreExecutive Vice President of National Music Publishers’ Association.

In a shared statement VarietyA Spotify spokesperson noted users a month’s notice of price increases, noting that the platform offers “easy cancellations and multiple plans for users to consider.”