I'm a premium user for more than a year and I love it! It is indeed cheap, but making it more expensive won't get them the same number of paying people paying some amount of money. So from that I'd say that they aim to get more people to pay for music again. As nlh mentioned, he is not buying music anymore on iTunes. You could swap iTunes for downloading as well.

Spotify might as easily help artist to release their own music in a seperate section of the application. I would love to see something like this.