US Senators Urge FTC Investigation into Spotify Over Music Bundling Practices

Two US senators have called on the Federal Trade Commission (FTC) to investigate Spotify over claims that its bundling of music and audiobook subscriptions is misleading consumers and harming the broader music industry.

Republican Senator Marsha Blackburn of Tennessee and Democratic Senator Ben Ray Luján of New Mexico sent a formal letter on Friday to FTC Chairman Andrew Ferguson, urging the agency to examine the streaming giant’s recent reclassification of its subscription tiers.

Spotify began including audiobook access in its Premium Individual, Duo, and Family plans last year, effectively turning them into “bundled” subscriptions. The move, critics say, allowed the company to reduce royalty payments to songwriters and publishers.

“We have serious concerns about Spotify’s recent move to convert all of its premium music subscribers into different – and ultimately higher-priced – bundled subscriptions without their knowledge or consent,” the senators wrote.

“These actions harm consumers and could deeply damage the marketplace and the music royalty system. We urge the FTC to investigate the impact of Spotify’s recent actions.”

Industry Backlash

The call for a federal probe comes as criticism of Spotify’s bundling strategy continues to grow within the music publishing community. At the National Music Publishers’ Association (NMPA)’s 2025 Annual Meeting, the organization’s Executive Vice President and General Counsel, Danielle Aguirre, highlighted that Spotify’s bundled offering has – “by Spotify’s own numbers” – resulted in a $230 million loss for publishers in its first year.

“These losses will continue if we can’t reverse or correct Spotify’s actions,” Aguirre said. “In fact, if we don’t stop them, we are projected to lose over $3.1 billion through the next CRB period,” referring to Phonorecords V, which sets mechanical royalty rates for 2028 through 2032.

NMPA President and CEO David Israelite welcomed the senators’ intervention, calling it a vital step in curbing harmful industry practices.

“We are extremely pleased that United States Senators Blackburn and Luján are also asking the FTC to investigate this as it will have ripple effects across other platforms,” he said. “These unfair business practices hurt music creators and users and it must stop.”

Royalty Loophole?

The controversy began in March 2024, when Spotify reclassified its Premium subscription tiers as bundles, following the addition of 15 hours of audiobook access per month.

Under Phonorecords IV – a 2022 legal settlement between music publishers and streaming platforms -services offering bundled subscriptions in the US are allowed to pay lower mechanical royalty rates than standalone music services.

Spotify’s standalone Audiobooks Access plan costs $9.99 per month, while its music-only Basic Plan is priced at $10.99. Critics say the company exploited this regulatory framework by setting a high price for its audiobook plan, thereby reducing its obligations to music rights-holders.

“Spotify’s intent seems clear – to slash the statutory royalties it pays to songwriters and music publishers,” Blackburn and Luján wrote in their letter. “Not only has this harmed our creative community, but this action has also harmed consumers.”

Consumer Impact and Hidden Options

The senators also accused Spotify of limiting access to its music-only Basic Plan. While the company quietly re-launched the plan in response to criticism, Blackburn and Luján argue that it is hidden from most users and only available to some existing subscribers.

“As of January 2025, only a handful of Spotify’s millions of Premium Plan subscribers switched back to a music-only ‘Basic’ plan,” they wrote.

A Spotify spokesperson defended the company’s practices in a statement to Variety, saying its approach is “industry standard” and designed to offer consumers flexibility.

“We notify users a month in advance of any price increases and offer easy cancellations as well as multiple plans for users to consider,” the representative said.

Ongoing Scrutiny

This is not the first time Spotify’s bundling practices have drawn bipartisan attention. Last year, Senator Blackburn joined Democratic Representatives Ted Lieu and Adam Schiff in questioning whether the move complies with the spirit of the 2018 Music Modernization Act.

“Few would expect customers to purchase audiobooks at that rate when it is available for free with the music service for only $1 more per month,” lawmakers wrote at the time. “This was, however, the same moment in which Spotify automatically reclassified the 50 million subscribers in its music services into a bundle.”

The FTC has not yet issued a response to the senators’ latest request.