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How much does Spotify pay musicians?

Answer

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Kevin Stringer
09/30/2019

There’s no simple answer, as Spotify has a fairly complicated payment structure, but by delving into the site’s terms of service and looking at a few recent stats, we can get a good idea of how much (or how little) artists make.

First, it’s important to recognize that a paid play (i.e., a play from a Spotify Premium user) pays differently than a free play. When a Spotify user listens to a song with the free version of the service, the copyright holder receives a payment from the site’s total generated ad revenue. When a user listens to a song on Spotify Premium, the copyright holder receives part of the site’s total subscription income.

As ad revenue, Spotify Premium subscription counts, and total play counts change, so do the payouts. Average artist payments change significantly from year to year.

In December 2018, Digital Music News published a list of average streaming royalty payouts from various streaming services. Spotify ranked toward the bottom of the list with an average payout of $0.00437 per play (that’s about 4 tenths of a cent). The publication estimated that a musician would need about 336,842 listens per month to make $1,472 (the federal minimum wage in the United States).

Another crucial note: Digital streaming payments go to the copyright holder, not straight to the artist. If an artist is on a label, their payments might be split among producers, songwriters, distributors, sampled artists, and anyone else who had a hand in the creation and promotion of the song. In other words, the artist might get a small fraction of that $0.00437.

Here’s how the other major streaming services compare, based on the late-2018 numbers:

  • Napster - $0.019 per play
  • TIDAL - $0.0125 per play
  • Apple Music - $0.00735 per play
  • Google Play Music - $0.00676 per play
  • Deezer - $0.0064 per play
  • Spotify - $0.00437 per play
  • Amazon - $0.00402 per play
  • Pandora - $0.00133 per play
  • YouTube - $0.00069 per play

So, why are streaming sites so stingy? For one, they don’t make much money—or, in some cases, any money. The only time Spotify has turned a profit in its 13 years of business was the last quarter of 2018. At this point, music subscription services haven’t quite figured out how to make significant revenue from their user bases.

Every major streaming service changes its payouts regularly, so take the numbers above with a grain of salt. The takeaway is that musicians don’t make much, but streaming services don’t, either.