Spotify pays around $0.007 per stream to artists

Posted Dec 7, 2013

Spotify has revealed the average figures of how much artists make from their service in terms of royalties. Spotify pays an average of $0.007 per play, according to figures reported on the Spotify Artists website. Spotify has paid over $1 billion in royalties since launching in 2008. Of that $1 billion, $500 million was paid out in 2013 alone. Spotify is asking artists not to focus on the small amount per stream, but rather the accumulative earnings from a great album. Spotify keeps 30% of the money from subscriptions and ads.

One of the artists speaking out against Spotify is Thom Yorke of Radiohead. Yorke removed his albums “The Eraser” and “Atoms for Peace” from Spotify and said that he was standing up for his fellow musicians. “Make no mistake new artists you discover on #Spotify will no[t] get paid,” said Yorke in a tweet. “Meanwhile shareholders will shortly being rolling in it. Simples.”

“Our belief has always been that if we can offer fans a listening experience superior to piracy, then they will be happy to pay for it, and in turn we are happy to pay out nearly 70% of all the money we earn in royalties,” stated Spotify on their website. “We believe that this is the fair approach to take, and that as we grow we will become an increasingly significant contributor to artists’ financial lives.”

The 70% is paid to record labels. From that point, the record labels take a cut before money is paid to managers and artists.

Spotify currently has 6 million subscribers across the world. Some artists were paid over $3 million in 2013. Spotify also pointed out that they pay out more than double compared to a video streaming website like YouTube.

[Source: BBC]