How much Spotify pays per stream and how to earn more

• Spotify generally pays between $ .003 and $ .005 per stream, which means you’ll need around 250 streams to make a dollar.
• What you will be paid per Spotify stream depends on your distribution agreement and listener base.
• If you want to make more money from streaming, post more music and request that your music be placed on the official Spotify playlists.
• Visit the Insider Tech Reference Library for more stories.

Over the past decade, several downloadable streaming platforms (also called DSPs) have emerged, including Spotify, Apple Music, SoundCloud, and Pandora. Spotify in particular has made a name for itself as a streaming giant.

But how are the musicians doing? Despite all the benefits that Spotify offers listeners, they are not tremendously generous when it comes to paying artists. They are also not transparent about how much artists should expect to earn per broadcast.

Many factors affect how much you will be paid to stream on Spotify, including where your listeners live, whether they have a Spotify premium account, and what type of distribution agreement you have.

Here’s what you need to know about payments on Spotify.

How much Spotify pays for streaming

According to the Recording Industry Association of America (RIAA), paid subscriptions have replaced album sales. And if physical sales weren’t suffering enough, the RIAA also reported that the pandemic reduced physical product revenue by 23%. With that portion of their revenue declining and in the face of industry-wide live event closures, music streaming revenue has become even more critical for artists.

However, Insider found that Spotify has paid artists only $ .0033 per flow, with other sites reporting more than $ .0054. Translated, you will need around 250 streams to earn a dollar.

“This is why rappers make money through merchandise, endorsements and performances,” 27-year-old New Jersey rap artist Brandon Pain told Insider.

This hasn’t always been the case – Spotify’s payment rates have changed over time. In 2014, they paid $ .00521 on average, but two years later, the average rate dropped to $ .00437. By 2017, the average pay rate had dropped back to around $ .00397, according to artist rights site The Trichordist.

How Spotify Streaming Royalties Work

Royalties are the payments an artist earns from broadcasts. Spotify royalties are specifically distributed from the net revenue collected from ads and Premium subscription fees.

Artists are paid monthly. When Spotify pays artists, they count the total number of streams of each of an artist’s songs and determine who owns each song and who distributes it. First, rights holders are paid. The dealer is then paid (this may be the same as the rights holder in some cases). And finally, you get paid.

“Every DSP has its pay, and it’s the responsibility of your distribution company to get the payment correct. They help you set it up and guide you through how much you get paid per transmission and the royalty payment process,” Pain said.

Independent artists and their managers often use distribution services like Tunecore or Distrokid to bring their music to Spotify. Top artists who have signed with major record labels go through an internal process.

“Now that there are more distribution points, that sector of the industry is starting to scale. Which means the cost is starting to come down,” said Sharlea Brookes-Keyes, manager of Boston rapper Vintage Lee. “Tunecore makes 100% of the royalties [meaning they don’t take any of your streaming revenue]But you have to pay an annual fee of $ 50 for an album and $ 10 for a single. ”

How to increase how much you earn per Spotify stream

A study by Digital Media Finland in 2017 focused on the prorated system used for Finnish Spotify Premium subscribers. This system pays rights holders according to the level of their broadcasts against popular songs for a specified period of time.

Popular artists get more of their music, which means they earn more. So for artists to make more money, they need more streams.

Many artists have found that the surest way to grow a fan base is by releasing music consistently and frequently. A new good work every year is great, but a sporadic release schedule will mean a smaller group of listeners.

But other factors can also influence how much a musician earns.

Not all listeners are the same. Spotify Premium listeners pay more per stream than free tier listeners. And the payment per stream also changes according to the country the listener comes from; According to music distributor iGroove, US listeners will pay $ 0.0035 per stream, for example, while Italian listeners will pay $ 0.0019.

The role of Spotify’s 4 billion playlists shouldn’t be an understatement either. “Popularity and being on their editorial playlists are two big factors,” manager Brookes-Keyes said. “[Vintage Lee’s] The song was already in vogue on the streets and was relatively cool, but when ‘NBA 2k18’ came out [and it was put on the official playlist], its currents grew and remain consistent. “

RapCaviar, curated by Tuma Basa, is one of the most popular editorial playlists. Its strategic curation has helped propel artists to a wider audience and showcased underground music, and Vulture even called it “the most influential playlist in music.”

If the artists are on smaller playlists like Mellow Favorites, there is still the opportunity to move on to a bigger and better known one like Chill R&B. Once an artist reaches a more notable playlist, the likelihood that they will get more followers and more streams increases.

In 2018, Spotify also introduced its playlist submission tool. The feature gives artists the option to submit unreleased music to Spotify, for a chance to have that music on a playlist as soon as it’s released.

Once an artist chooses their track and submits it, they can tailor the song settings according to mood, style, genre, recording type, and more. This helps Spotify decide which editorial and algorithmic playlists your music belongs to and how to present the track to more fans.