Cost of Spotify Premium for different countries in relation to USD.

[Rand]

Cost of Spotify Premium for different countries converted to USD.

Australian dollar $11.99  = $12.5

Euro 9.99€  = $12.5

Swiss franc 12.95 = $13.5

Swedish kronor 99 =  $15

British pound 9.99 = $15.8

Danish krone 99 = $16.64

Norwegian krone 99 = $17

Price for Spotify premium in the US: $9.99

I could come up with several different reasons why this is how it is, however I would like someone who actually works at spotify to state the reasons why the price for spotify premium differs so much between countries. And why it would be cheapest in the USA.

Thank you.

Tvspotify1

[user-removed]

Prices varies from country to country in food, Spotify etc.

[adfhogan]

Not an answer.. sure, prices vary.. but food is a physical thing with clear input costs. There aren't the same things like labour costs etc. to consider when it comes to online, as the labour can be done in the countries with the cheapest workforce or centrally from the same place that other regions are having their work done from, therefore having no difference. People in Australia are beginning to wake up to when they're being charged more online than other areas.. We don't like it.

[user-removed]

Spotify is licenced in every country with new license. There is no same license globally, so price varies.

[krikelin]

This is no difference from sales of other stuff.

A jacket in Sweden can cost 599 SEK,

Same jacket in US $59.

This because the prices is also set "psycologically", so even if the same ground price is there, the prices is adjusted to meet a "nice price" rate. The difference between 99 SEK and $9 may be large between countries, but pricing levels are different in different countries. Think that a wage in US can vary much more than in Sweden.

[adfhogan]

Yes, but when you're buying a jacket.. or a DVD (a lot of jurisdictions, it's not illegal to have a region free player, only to circumvent copy protection - copy protection and region locking being distinct concepts that often vendors will attempt to intertwine but are distinct as aims).. or a CD, you can import it from that cheaper market - in some cases still cheaper with shipping than if you bought it locally even factoring in local consumption taxes. Sure, it might have some different promotional tracks, or different "extra features", or different language options in the subtitles... but the core content's generally going to be the same. Case in point. I have an Android phone. I needed an MHL adaptor. I checked local retailer ... $40AUD I checked a retailer online.. $30AUD - shipped.. It took a week to arrive, but arrive it did. With digitally distributed, geo-IP locked content - you lose that ability to shop across markets. To me, it sends the wrong signals to charge one group of people one price, and another group of people another price for the mostly the same content when it's available on the same global network. In essence, you're punishing people who you're trying to ween off the "internet is free" mentality into the world of subscriptions and micropayments. Don't get me wrong, I don't hate spotify in and of itself - I've been using it a lot at work of late and a lot of friends, both in Australia and internationally have given it a go. It's totally awesome to be able to hear something on the radio or in a movie or on TV.. tag it with Shazam or Google Music Search.. and then to key it into Spotify and hear it play on demand. It's also totally awesome that there's a linux client available - which although in alpha - works.. stably.. (one reason you'll never find me buying an Apple product is the whole 'thalt shall use iTunes' mantra)... and ok, maybe I'm not your average consumer (running Linux on the desktop, stock Android on my phone with root access, bearded and a system administrator - living stereotype much?).. but I'm interested in doing the right thing, and I know content has to move to pay with advertising revenues falling and content, well, more generally intellectual property, increasingly becoming a new and renewable commodity in a world where consumption of physical resources needs to be curtailed. I know the local record companies probably play into the mix.. and that by taking a segmented market approach as opposed to a global market approach, there's probably a certain "flagfall" cost in smaller markets that means a higher cost as the smaller markets won't be able to match the economies of scale that would enable larger markets to charge a lower price per user but still make more by having more room to play with the margins. I guess it just grinds my gears that the price for the same 1s and 0s is higher. I guess we'll see what happens if/when spotify considers mobile provider partnerships (especially in countries like Australia where unlimited data often has many asterisks/T&Cs, doesn't exist or costs a lot), and if the AUD should fall against the USD (we're holding above parity for awhile now)... if the price will rise then or hold? I'll probably succumb when my advertising supported listening is cut back to 2.5 hours a week if I'm still working in a business that allows employees to stream 🙂 .. I guess it's just being so familiar with what the currency's doing and initially being very interested in mobile streaming - and having heard things on US sites talking about the price - to find out, "no, you actually pay more".. well.. it kinda dulled the shine a bit. I hope you find my post (although perhaps a bit long winded) polite. I believe such conversations are always best dealt with in an even tone.. and again FWIW, I do thoroughly enjoy and congratulate you on providing a working linux client... and in an apt repository at that!

[adfhogan]

(Gaaah.. sorry.. for some reason it seems to have swallowed my paragraph breaks - must be a difference in EOL handling)

[Drella]

It's always like this on almost every online service out there. Deal with it.

[adfhogan]

Just because there may be a semblence of status quo doesn't mean I should just quietly "deal with it". Also, a single post, from an account registered on the day, and not touched since.. with kudos from a community founder? 🙂 *raises eyebrow*

The argument of physical goods costing $A in one country and $B in another country doesn't quite hold when you're talking about digital distribution.. and often with physical goods, you can ship from the cheaper country. Physical media retailers in Australia have been doing grey+parallel importing for years. The only industry in Australia holding out from a physical perspective has been the book publishing industry. Movies tried the whole region coding thing - but multi-region players are common with DVD and I'm not sure if Blu-Ray is getting quite the same takeup as DVD.

Perhaps, moving to digital, everything old is new again 😄

It's at least worth a proper FAQ entry somewhere and not just shrugged off with "It happens" 😕 ... I mean my primary instinct is that the local music publishing companies are holding onto an anachronistic, geographically based licensing regime and demanding a higher base/flagfall price for the Australian market,

*muses if the ACCC has done an investigation on this kinda disparate pricing yet*

[Dealwithittechs]

Adfhogan, i completely understand where you are coming from but you are asking the wrong person something both of which they do not understand nor do they have access as they are paid only for their forum skills (if even paid) and do not have the business background to understand the complexity of physical goods requiring the economics of other physical goods (such as gasoline) to bring physical goods to your door. They also do not understand the tax laws nor the licensing or distribution of music sales throughout the world. I am sorry they were so rude to you and i feel bad for you that they threw u through so many hoops even though u were so nice to them giving them explanations they clearly do not deserve! The clear and most basic reason for pricing as is most consistent with capitalism is their knowledge that these countries will pay this amount, so it is charged. Spotify's market location (IT guys this is not physical) allows it to charge these amounts based on both competition and differentiation. Thus the "deal with it" mentality says that because you will pay for it, they will charge it

[CBooo]

The answer is very simple but it is simply never told. Prices are never caluculated based on costs, they are based on the offer/demand balance wich translate into : How much are the users willing to pay.

Basically the calculation is price X qtt of users = maximum possible revenue. When price increases, qtt of users decreases. Every company simply tries to find the price that provides maximum revenue. And this price is different in every market.

Now the hard true: Companies don't exist to serve you. They exist to generate money to stockholders. They only serve you because your money is part of the equation. And, there is nothing wrong about this (as far as everything is lawfull).

[adfhogan]

I'm sure you're right. That said, Australia's been screwed for years in this fashion and we're waking up to it. Especially given our currency has been over parity with the USD for a couple of years now...

I do wonder what spotify will do when the AUD dips below the USD ... Will they fall back on the buffer they've been charging, or will they just crank up the fees again?

[arnostam]

Agree with the market pricing. This has always been true. And differrences increase when availibilty is scares. E-commerce and international  shipping has been a huge game changer for fysical goods. You can now buy directly from the cheapest market and have it shipped cheaply.

Now we need to look for the cheapest solution out there. Best product, lowest price. 

Stupid thing is that if you are American and buy your US premium account and move to australia you can keep paying the 9,99USD per month for the rest of your live. 

"Listening to Spotify abroad
If you have a Premium or Unlimited account, you can listen abroad for as long as you like. Spotify Free users can listen for 14 days."

[BobsterLobster]

Am I right in noticing that the cost of Spotify Premium in Mexico is set to 10 EUROS?! If so, why on earth is the price in Euros, and not US Dollars or Pesos? This seems like a huge rip-off to me.

[adfhogan]

Will be interesting to see now that AUD has dropped below parity with USD if Spotify try to recoup additional funds and blame it on exchange rate or keep the price set.

[ashermccall]

I do not work at spotify but I have an educated guess for the reasons of the price variation.

I think it has to do with the number of users and the infrastructure set up in those countries. There is a lot of data being set around so one way to cut latency is to store cache's of the data (in this case, music) in server locations around the globe.

So when a user connects from U.S. in California, there is most likely a server in California near their location which they can steam their data from instead of all streaming from the same location (whereever Spotify's headquearters may be). So the more of these servers they have the better service they can provide. 

There is more of this infrastructure set up in the U.S. because it is where Spotify started and that where the most user's currently are so it makes sense to invest in infrastructure here in the U.S.

You can think of it as supply and demand:

In other countries where they are still building up infrastructure there is LOW SUPPLY of connection availablity. Therefore they raise prices because of demand and also use the money to build more infrastructure in order to provide for increases in demand as it becomes more popular in different countries.

[meahtenoha]

Hi everyone! Just want to jump in here to clear up some theories bouncing around this thread. 

Each time Spotify launches in a new territory we need to negotiate with that country’s record labels and other rights holders in relation to music licensing fees. 

We set our pricing at the level that we believe is fair for consumers, rights holders, and Spotify, while remaining a low-margin business.

Also, just to clarify, Spotify headquarters are in Sweden 🙂

[Joe]

No, I suspect it's just based on what the local market will stand. Premium in Poland is PLN 19.99 which is cheaper than USA.

[user-removed]

The reason for the price difference in different countries is ; the Taxes rate of each country,

[adfhogan]

You're assuming the payments go through the local country.