US senators urge FTC probe into Spotify's higher-priced bundle

Two United States senators have requested that the Federal Trade Commission (FTC) investigate Spotify regarding its recent subscription adjustments.

Senators Marsha Blackburn and Ben Ray Luján allege that Spotify bundled music streaming with audiobook services into a higher-priced subscription without obtaining user consent.

In a letter sent to the FTC on June 20, 2025 the senators claimed that Spotify converted standard premium subscriptions into more expensive plans without clearly informing consumers.

They also noted that US regulations permit digital music providers to pay reduced royalties when bundling services.

They believe Spotify used this to lower payments to songwriters and publishers.

🔗 Source: TechCrunch

🧠 Food for thought

1️⃣ Artist compensation remains a flashpoint in the streaming era

The senators’ concern about reduced royalty payments reflects a longstanding issue in the music industry where streaming economics have consistently favored platforms and major labels over creators.

Studies show that approximately 73% of revenue from a typical €9.99 streaming subscription is retained by major labels, leaving only 10% for creators and publishers1.

This compensation structure requires artists to generate millions of streams to earn meaningful income, with Spotify’s per-stream rates estimated between $0.003 and $0.0052.

The controversy over Spotify’s bundling approach touches on this sensitive issue, as any reduction in statutory royalty rates directly impacts songwriters and publishers who already receive a minimal share of streaming revenue.

Despite the massive growth of streaming services during the pandemic, with Spotify’s valuation tripling, artist payouts did not increase proportionally, fueling ongoing debates about fair compensation3.

2️⃣ Regulatory intervention in music streaming is increasing globally

The senators’ call for FTC investigation follows a growing trend of government scrutiny into music streaming economics across multiple countries.

In the UK and France, legislative efforts are already underway to reform streaming royalties, with proposals for equitable remuneration and minimum payment standards for artists3.