Shares of streaming giant Spotify fell as much as 7% on Wednesday, following Apple’s announcement of a bundled strategy for many of its services that reduced the price of Apple Music subscriptions.
The Swedish company, whose 138 million paying subscribers dwarf Apple Music and Amazon Music, lashed out at the iPhone manufacturer’s move that was declared on Tuesday.
Spotify Technology said the Apple One package reverses streaming audio rivals by favouring its Apple Music service.
Apple reported the bundle was aimed at existing users of its services and its clients can avail alternatives for each of the organisation’s services.
Spotify and Apple cost $10 per month to get their streaming music service, but also the Apple One package, which begins at $15 per month, bundles it with other services such as television or video games.
“What Apple is attempting to do is sort of form an ecosystem, like what Amazon Prime has done, where they become a one stop shop, and certainly because of that competitors like Spotify do face some risk,” explained Aadil Zaman, spouse at Wall Street Alliance Group.
Spotify already has bundled offerings with Walt Disney Co’s Hulu and ViacomCBS Inc’s television network Showtime.
“You have to assume that we’ve expected all of those things,” Spotify Chief Financial Officer Paul Vogel said at a Goldman Sachs conference on Wednesday.
The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Akanksha Rana and Devik Jain in Bengaluru and Supantha Mukherjee in Stockholm. Editing by Shounak Dasgupta.
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