So in the short run, it will hurt Spotify's profits to go forward with releasing the HiFi tier. Secondly, the roll out is going to cost money. So how has this impacted Spotify's release date of a new HiFi tier? First of all, releasing it is not going to generate any additional profits as I've already discussed. The only thing they care about at this point is growing their podcast user base and doing other things to increase net profits from podcasting. It has no effect on net profit either way. What this means is that Spotify no longer cares whether it adds new music streaming users or looses them. Plus, the podcasting part of Spotify's business is now making money, whereas music streaming is not. Why? Because Spotify spent millions (? billions) on acquiring several different podcasting companies. Since Spotify made the HiFi tier announcement earlier this year, they have posted their first quarterly net income ever, and have continued to do so in every quarter since, so profit expectations have now escalated.Īs many of you have noticed, the pushing of podcasts by Spotify has intensified.
Spotify on the other hand is now a publicly traded company that has to report quarterly financial results, so profits are extremely important. Also, the music streaming services of these companies help them retain the users as part of their ecosystems. They serve as another service that helps drive customers to purchase Apple devices or buy things from/through Amazon. Those two streaming services are just a small part of huge companies, and Apple and Amazon could care less if they're profitable. The competition from Apple Music and Amazon Music have caused this. Spotify no longer makes any profits off its music streaming business.
Spotify will already have to pay higher server/bandwidth costs to allow HiFi streaming, so paying more to the labels would be a loss unless it’s a very small cut.I propose that the reason Spotify is in no hurry to release a HiFi tier is that it doesn't make financial sense to do so. The labels could hypothetically demand money more if/when Spotify charges an additional cost for users to access HiFi, but I doubt it’ll happen. I believe someone on here confirmed that record labels already upload most tracks in lossless quality to Spotify-or at least newer releases-so Spotify already has access, and won’t have to pay more to labels. This will also allow Spotify to market HiFi-capable devices made by their partners to users and get a cut of that sale for the referral. I think they’ll have a built-in “audio quality” indicator in the app-close to where it shows whether you’re streaming to a connected device-to show users whether their devices actually support HiFi before they upgrade.
#SPOTIFY HIFI REDDIT UPGRADE#
HiFi is released as free for all premium users for 2-3 months, then an additional cost to upgrade to a higher tier that includes HiFi. I personally want to keep my family normal plan though. What I'm clueless is if Spotify pays labels for hifi access, does it have to pay separately for high quality music in normal plan or HQ music is included in the package if the service pays for hifi. I'm realistic about those who're willing to pay more for hifi as Spotify is not Apple nor Amazon, streaming is the only channel of their revenue (I don't believe Spotify is able to offer it for free). Increased price in separate hifi plan and Spotify drops all normal plans without hifi (like Deezer does) Increased price in separate hifi plan (acceptable to me as they have to pay more) alongside with normal premium plan (no hifi) without any change of subscription fee or My question is when Spotify goes lossless, in terms of business and marketing, what is it going to be for customers: Free lossless tier without extra cost from AM doesn't make me leave Spotify as both the platforms still have pros that the other don't. Using both the services concurrently and still happy with both. I've been on Spotify for nearly two years, and I'm also a customer of AM for almost the exact duration.
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