Spotify increases prices in South Africa

Since the debut of Simfy Africa more than a decade ago, music streaming service pricing in South Africa has remained relatively consistent across the board. However, this steadfast pricing paradigm is beginning to undergo a transformation. The landscape has evolved significantly since Simfy’s inception, with prominent global streaming giants like Apple Music, YouTube Music, Spotify, Tidal, and Deezer coming to define both the local and international music streaming markets.

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Despite the radical shifts in the industry, most of these streaming platforms have maintained a monthly subscription fee of R60 for unlimited access. This steadfast pricing stance has persisted even as the South African rand has weakened against major currencies such as the euro and the dollar.

In contrast, other international software-as-a-service businesses employing a subscription revenue model similar to music streaming have frequently and substantially raised their prices, often surpassing inflation rates. In the past year, Adobe Creative Cloud, Xbox Game Pass, and Microsoft 365 have all undergone noticeable price hikes.

However, it appears that the tide is shifting against South African consumers. This year, Apple Music, Deezer, and Tidal have all announced impending price increases.

Adding to this trend, Spotify recently joined the fray by notifying its Premium subscribers of price hikes affecting its Individual and Duo plans. Under the new pricing, the Individual plan rises from R59.99 to R64.99 per month, while the Duo plan, which enables two users to stream on a single subscription, increases from R79.99 to R84.99 per month.

Spotify explained to its subscribers that these price adjustments are necessary to sustain investments and innovation in its product offerings and features, ultimately enhancing the user experience.

Although Spotify’s pricing increases, averaging just over 7%, slightly surpass inflation, they still fall significantly short of compensating for the sharp depreciation of the South African rand in recent years.

Comparing pricing across three mature markets (the UK, US, and Germany) and two emerging markets (South Africa and Kenya) for individual plans, it becomes apparent that streaming services are absorbing costs in weaker-currency markets.