Spotify has revealed plans to increase subscription fees in France, in response to a new tax directed at music-streaming services operating in the country.
The move comes nearly three months after the company vowed to begin disinvesting in France, initially pulling support from two festivals with the promise of more action to come this year — now we have a clearer idea of what kind of “action” Spotify has been cooking up.
The tax came into effect on January 1, and will see a levy of 1.2% imposed on Spotify and rival services including Deezer, Apple Music, and Google’s YouTube Music, with proceeds redirected to the Centre National de la Musique (CNM) — established four years ago to support the French music sector. While all the impacted companies are opposing the new law, Spotify has been the most vociferous, largely due to the fact it is the biggest player in the country.
Spotify hasn’t revealed how much it’s increasing the prices by — it merely said that moving forward, French users will be paying the highest subscription fees in the entire European Union (EU). Indeed, the company plans to inform subscribers “over the coming weeks” in terms of how much extra they’ll be paying — while it seems that part of the plan is to try and drum up enough consumer consternation to heap pressure on the powers-that-be, the law is now in effect so it’s difficult to see there being any changes in the near-term.
A Spotify spokesperson told TechCrunch that it was just trying “to be transparent with our users” that they should expect a price hike, and that it had done “everything we could” to avoid this but there was no way around it.
What’s perhaps the most telling part of this whole episode is how important France is to Spotify in terms of market traction. Its response here differs somewhat to its response to a similar tête-à-tête in Uruguay, which was also trying to pass a new law that promises “fair and equitable” remuneration for every artist involved in a recording. Spotify said it would pull out of Uruguay completely, arguing that the law would mean it would have to pay rightsholders twice for the same tracks — its threat worked, and it changed its mind on its exit when the Uruguayan government gave assurances that music-streaming platforms wouldn’t have to cover any extra costs resulting from the law.
