Senators urge FTC to investigate Spotify’s higher-priced bundled subscription

Two U.S. senators have requested that the Federal Trade Commission (FTC) investigate Spotify due to allegations that the company bundled its music streaming and audiobook services into a more expensive subscription without obtaining user consent, while also reducing royalty payments to creators in the process.

On Friday, June 20, U.S. Senators Marsha Blackburn and Ben Ray Luján wrote a letter to the FTC, claiming that Spotify converted standard premium subscriptions into higher-cost bundled subscriptions without informing consumers. They also highlighted that existing U.S. regulations permit digital music providers to pay a reduced music royalty rate if the subscription is bundled with other legitimate offerings.

“Spotify’s intent seems clear—to slash the statutory royalties it pays to songwriters and music publishers. Not only has this harmed our creative community, but this action has also harmed consumers,” the letter states.

Last year, the Mechanical Licensing Collective (MLC) sued Spotify for allegedly undercompensating songwriters and publishers, but the lawsuit was dismissed in January.

In March 2024, Spotify restructured its Premium tiers to include 15 hours of audiobooks, raising the price to $12 for individuals and $20 for families. Users have to manually opt out of the plan.

This change has reportedly caused publishers to lose $230 million in the first year, according to Danielle Aguirre, executive vice president of the National Music Publishers’ Association.

In a statement shared with Variety, a Spotify spokesperson noted that users were notified a month in advance about the price increase and the platform offers “easy cancellations as well as multiple plans for users to consider.”