YouTube Premium price hike has made many of you think twice

YouTube Premium is one of those subscriptions that many people reluctantly pay for because, once you get used to it, it’s hard to think of going back. No ads, background playback, downloads, YouTube music – it’s easy to see why users find this essential, even if you’re annoyed by the monthly deduction on your bank statement. That’s probably why Google thought it was able to implement the latest YouTube Premium price increase in the US without losing too many subscribers, but we wonder what the reaction will be. We thought it would be fair to ask readers if this was the point where they finally had enough.

We did this through a referendum. This first appeared in our report on the price increase, which increased the individual plan from $13.99 to $15.99 and the family tier from $22.99 to $26.99. The last US increase was in July 2023, so this may not be a huge blow, but it still may have made it harder to justify the premium for some people. We later added the poll to our Verizon Perks follow-up, as that discounted Premium perk also became more expensive, and to our coverage of Google’s AI Pro offering, which suddenly seemed a lot more relevant as a way to soften the blow.

The results of the survey are below, and may be a bit more nuanced than Google and YouTube expect.

As the results above show, the biggest response from you in our survey was that you would tolerate a price increase, with nearly 42% of respondents voting this way. Just over 18% said they planned to cancel, and another 9% said they would change plans because of the increase. 30.6% said they were not customers.

That last figure is important because it makes the rest of the results for YouTube look a little better. However, when you remove those voters and only look at the data for respondents who currently have a premium subscription, the picture changes. Among customer voters, 60.7% said they would stay on their plan, 26.4% said they would cancel, and 12.8% said they would switch to a different plan. Combining those last two figures, approximately 40% of readers who are currently on YouTube Premium are changing or canceling their plans as a result of the price increase.

This doesn’t look great for YouTube, especially since a $2 increase to the individual plan only translates to 14% more revenue for the streaming service. But let’s not be naive here. First, we should acknowledge that our survey was conducted among readers of articles about price increases, and such stories are more likely to attract those who feel aggrieved by the increases. This means that voters may not represent a fair cross-section of the YouTube Premium community at large.

Secondly, this is a half-trillion dollar platform – it won’t make this kind of business decision right away and hope for the best. There are probably a lot of numbers boffins at YouTube HQ with things much more complex than my notebook example above, who would be based on extensive market research. In other words, YouTube knows what it’s doing. It could have just raised the price by $1, but it opted for $2 because most of you aren’t going to cancel. You may have decided you were going there while reading the news, then calmed down and faced the fact that you can’t go back to the non-skippable ads.