📷 Image Credits: Billboard
Spotify’s HiFi audio delay might pay off, as there are now more people willing to pay more for premium audio than when the plan was first announced.
Compared to when Spotify announced HiFi three years ago, the subscription market is larger and the high-definition audio market has matured.
In February 2021, Spotify announced its high-quality audio offering, called HiFi, and released a promotional video featuring Billie Eilish and her brother/producer, Finneas, waxing about the benefits of listening to recordings in their natural state rather than the compressed files that became standard in the digital era. The streaming war is going Hi-Fi, Billboard proclaimed a few months later.
But it was a false start. Spotify’s HiFi didn’t materialize, and the company officially announced its delay in January 2022. There were rumblings about HiFi in June 2023, but the rumors amounted to nothing. Instead, Spotify pushed ahead with building an all-in-one audio platform by building its podcast business and launching an audiobook offering.
Now, HiFi appears to be back on track. This month, news broke that Spotify will finally launch a high-definition audio tier later this year. Still called HiFi, Spotify will offer the tier for an extra $5 per month for individual plans ($16.99 compared to $11.99, which bakes in an expected $1 increase from the current $10.99). The HiFi tier for family plans is reported to be $19.99, $3 more than the current $16.99.
Waiting three years could come with some advantages. First, there’s a large addressable market that wants high-quality audio. A 2023 MusicWatch survey found that 85 million Americans aged 13 and over agreed that obtaining the highest sound quality is important and that they would be willing to pay more to get it.
There are two types of premium audio streaming: 16-bit, known as lossless or CD-quality, and 24-bit, commonly referred to as high-resolution. Both Apple Music and Amazon Music Unlimited offer CD-quality and higher definition tiers that go up to 24-bit/192 kHz. Qobuz streams 24-bit audio up to 192 kHz.
Spotify’s rumored lossless audio could cost users at least $5 more per month, and it is expected to arrive by the end of 2024. The HiFi streaming may require an add-on on top of an existing plan, making individual users pay at least $17 per month for high-fidelity music on Spotify.
In conclusion, the delay in Spotify’s HiFi audio release might indeed pay off as the market for premium audio is growing. With an increasing number of people willing to pay more for high-quality audio, Spotify’s entry into the HiFi streaming segment could be a significant move in capturing this market in India.
