Concerns over Spotify’s business model have intensified as two prominent U.S. senators, Marsha Blackburn and Ben Ray Luján, urge the Federal Trade Commission (FTC) to examine the company’s recent shift toward bundling music and audiobook services. The lawmakers argue that this strategy reclassifies premium subscriptions into a category that allows Spotify to pay lower royalty rates to songwriters and publishers. They claim this move not only undermines fair compensation for creators but also misleads consumers by automatically transitioning them into costlier plans without their explicit consent.

The issue traces back to a legal dispute initiated by the Mechanical Licensing Collective (MLC), which accused Spotify of underpaying royalties after changing its subscription structure. Although the lawsuit was initially dismissed, the MLC sought reconsideration. Meanwhile, the National Music Publishers’ Association (NMPA) has estimated that this bundling approach caused a $230 million loss for publishers in its first year and could lead to over $3 billion in losses by 2032. Senators assert that Spotify manipulated pricing structures to exploit regulatory loopholes, particularly by inflating the price of standalone audiobook access to further reduce music royalty obligations.

Spotify has defended its actions, stating that it adheres to industry norms by providing advance notice of price changes and offering flexible cancellation options. However, critics argue that the company obscured the availability of its music-only Basic Plan, making it difficult for users to revert to a non-bundled option. While Spotify maintains it delivers value to consumers, the bipartisan call for FTC intervention highlights growing scrutiny over how streaming platforms shape market dynamics and affect creative communities.

In an evolving digital entertainment landscape, transparency and fairness remain crucial. The push for regulatory oversight underscores the need for accountability in how companies structure their services and interact with both content creators and consumers. As debates continue over fair compensation and ethical business practices, the outcome of this investigation could set important precedents for the future of streaming and intellectual property rights.