Entertainment
Senators Call for FTC Investigation into Spotify's Subscription Changes
2025-06-23

In a recent development, two U.S. Senators have urged the Federal Trade Commission to investigate Spotify over claims that the music streaming service is shifting premium subscribers to costlier bundled subscriptions without their consent. The senators allege that this strategy may be an attempt to reduce royalty payments by taking advantage of regulations allowing lower rates for bundled offerings. They argue that these changes not only impact songwriters and publishers but also lead to higher costs for consumers. Despite introducing a new music-only option after backlash, few users have reverted to it. This issue has drawn attention from other organizations, including the National Music Publishers’ Association and The Mechanical Licensing Collective, both of which have taken legal action or requested investigations.

Details of the Subscription Controversy

In early 2024, Spotify implemented a shift that automatically transitioned all its premium music subscribers into a new bundled subscription model, which includes access to podcasts and audiobooks at a higher price point. According to the senators, this move was primarily aimed at reducing statutory royalty obligations. The updated plan now limits audiobook access, with usage beyond 15 hours per month incurring additional charges. Although Spotify reintroduced a music-only plan known as the "Basic Plan" following consumer feedback, very few users have opted to return to this simpler format. The lawmakers argue that this change could result in more than $150 million less in royalties during the first year alone, despite potential revenue gains from increased subscription fees.

The request for an FTC investigation comes after similar complaints were lodged by the National Music Publishers’ Association and The Mechanical Licensing Collective, the latter of which has filed a lawsuit against Spotify. These groups accuse the company of misclassifying its premium tiers to exploit regulatory loopholes. As of now, Spotify has not issued a public response to these allegations.

This unfolding situation raises significant questions about corporate responsibility and transparency in digital service models. It highlights the need for clear communication between companies and their users, particularly when changes directly affect pricing and service offerings. Furthermore, it underscores the importance of regulatory oversight to ensure fair compensation for content creators while protecting consumer interests. As the debate continues, the broader implications for the creative industry and streaming economy remain a topic of concern among lawmakers and advocacy groups alike.

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