Apple Hikes Music and TV+ Prices in First Increases Since Launch
Apple Inc. increased prices for its music and TV+ services for the first time, citing rising licensing costs, a move that risks giving rivals an edge in a fiercely competitive streaming industry.
The company increased the price of Apple Music to $10.99 a month from $9.99 for individuals, effective immediately, making it more expensive than services from Spotify Technology SA and Amazon. com Inc. Spotify surged as much as 9.4% to $97.07 in response to the news, its biggest intraday rally in almost three months.
With its video plan, TV+, Apple will continue to offer a lower price than companies like Netflix Inc. or Warner Bros. Discovery Inc., but that service has been slow to build as big a following as rival platforms. The price of Apple TV+ will climb to $6.99 from $4.99, and the standard Apple One bundle increases $2 to $16.95.
Apple's push into streaming in recent years is part of a broader effort to generate more revenue from services. That category now generates nearly a quarter of the company's sales -- almost $20 billion in the June quarter -- up from less than 10% in 2015. Apple is set to give its latest quarterly results this week.
The company said in a statement that the music price hike was due to “an increase in licensing costs” and that artists and songwriters will now earn more money. That came as good news for investors in Warner Music Group Corp., a top recording company, which sent the shares up as much as 15% on Monday.
Apple is also hiking its annual music plan to $109 from $99 and its TV+ yearly subscription to $69 from $49. Apple One bundles for families are going to $22.95 from $19.95, while the Premier package, which adds News+, Fitness+ and additional storage on top of Arcade, Music and TV+,
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