The Swedish music streaming service, which occupies a leading position in the world of streaming, is considered by the music industry to be a very attractive source of income. But many artists often criticize the low income that Spotify pays out, claiming that competitors pay more.
Spotify has become the most used streaming platform in the world. It not only has an extensive music catalog, but also a diverse podcast library and various personalized lists.
The Swedish platform, founded in 2006, offers users many benefits by making it easy to publish your own music, which is a great opportunity for artists.
However, there is not much information about the money that is paid for each reproduction that the musicians receive, and there is very little transparency on this issue from the platform.
When analyzing this situation, it must be taken into account that there are several factors that determine how much each artist earns with his music. For example, a musician who is more listened to in Canada does not earn as much as other more famous songs in Greece.
In addition, the numbers of money artists earn vary depending on the type of distribution deal the musician has, whether their song appears on lists that are popular in each country, among other factors.
Spotify pays each artist an average of $0.0033 per stream. With this average amount, the Swedish site is one of the platforms that pays musicians the least globally, with other sites starting at $0.0054. In short, for a musician to make a dollar off their song, they need to listen to it on Spotify at least 250 times.
It is worth saying that the amounts were not always the same, as rates have dropped significantly in recent years. For example, in 2016, a musician earned an average of $0.00521 per stream. In 2018, the amounts fell to $0.00437 and reached $0.00397 in 2019.
This payment system, which was adopted by Spotify and other platforms, made artists realize that the best way to make more money is to constantly release more music. Instead of releasing a new album from time to time, musicians make more money by constantly releasing material.
But this leader in the music streaming market continues to attract artists. How? The answer to this question is not as simple as it might seem at first glance.
First, Spotify owns a share of about 40% of the music market, and the number of its subscribers has exceeded 400 million people on all continents. This means that this platform generates every second stream of music. And this, in turn, speaks of the huge popularity of those artists who collaborate with Spotify. And this is no longer quite a tangible asset, since popularity is very difficult to convert into dollars at a certain rate. It will help the artist quickly become world famous and, accordingly, become rich.
The administration of the Swedish streaming service is well aware of the situation, which is why they set such low rates for royalties to artists. Despite the low payments to copyright holders of music and songs, Spotify continues to be extremely attractive for them as a source of income and a way to successfully build their musical career.