Spotify is entering the print book market. Will it become a new source of revenue?

Spotify said it will start selling physical books on its streaming platform as part of a partnership with online retailer Bookshop.org. The move was an unexpected expansion of the business beyond the audiobook segment, Reuters writes.

The physical book buying feature will begin to gradually launch later this spring for users in the US and UK. Pricing, inventory management and logistics will be handled by Bookshop.org, Spotify specified. However, the streaming service will receive affiliate rewards for purchases made within its app.

Spotify will also launch a Page Match tool that will allow users to easily switch between reading and listening. The feature will be available at launch for most English-language books, with a full rollout to all audiobook users planned for February 23.

Spotify shares were down 5.4% at the moment in trading on February 5 amid a sell-off in the broader market caused by investors exiting risky assets, particularly software developer securities.

The company is banking on developing new features in competition with other streaming services, including those from Apple and Amazon, Reuters notes.

Since the launch of Audiobooks in Premium in 2023, the service has expanded to 22 global markets and its English-language catalog has grown to more than 500,000 titles, Reuters wrote, citing Spotify. The number of new listeners increased by 36% and listening hours grew by 37%.

Spotify is entering the market at a time when print book sales remain sluggish as more users read e-books and online resources, Reuters notes. News Corp, which owns publisher HarperCollins, reported last year a slowdown in book orders from both readers and retailers, the agency writes. In addition, library book distributor Baker & Taylor, in business for nearly 200 years, ceased operations in January, Reuters notes.

January 30, Citigroup upgraded its recommendation on Spotify shares from neutral to buy and set the target price at $650. This assessment implies the potential growth of securities by 47.4% relative to the closing price on February 4.

The majority of analysts (34 out of 41) covering the company's securities advise buying the securities, six recommend holding, and one recommends selling.

Spotify in mid-January raised the price of its Premium monthly subscription by $1 to $12.99 in the U.S., Estonia and Latvia markets. Spotify has relied on price increases as one of its key growth drivers in recent years, Reuters notes. Last year, the company's CFO Christian Luiga said that despite price increases in more than 150 countries, Spotify has not recorded a noticeable acceleration in customer churn, underscoring the company's focus on retaining existing users rather than aggressively attracting new ones.

This article was AI-translated and verified by a human editor