Spotify also has a team of engineers who design new features for the service.įor example, the “Discover Weekly” playlist was created after engineers noticed that users were creating their own playlists with similar songs. This information is used to improve the user experience and recommend new songs and artists. They also use data analytics to study how users interact with the service and what they listen to. This costs money, and that’s why Spotify’s Premium subscription is more expensive than its competitors.įor example, Spotify employs a team of musicologists who analyze songs to create playlists that are both interesting and unique. In order to provide the best user experience possible, Spotify invests heavily in research and planning. This high royalty rate is the result of a licensing agreement that Spotify signs with the record labels. The company pays between $0.003 and $0.005 per song streamed, which amounts to around 60% of its total revenue. Spotify is an expensive streaming service because of the royalties that it pays to rights holders. There are several factors that contribute to the high cost of Spotify subscriptions. The cost of a Spotify subscription varies depending on the country, but it is typically more expensive than other music streaming services. The service has a free tier that allows users to listen to a limited number of songs, but the majority of the library is only available to paying subscribers. Spotify is an online music streaming service that allows users to listen to a library of songs for a monthly subscription fee.

Spotify plans costs