Royalties are generated every time somebody listens to a song Spotify,
Spotify's rate currently falls between $.006 and $.0084 per stream, depending on a couple of factors such as whether or not it was played on a free or paid for account.
Spotify pays out 70% of their revenue to the master and publishing owners. So, as their user base grows, their rates may grow too!
You can find more detailed information on Spotify's website. Check it out here.

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