Wondering how much you are paid each time your song is streamed on Spotify? Payouts to songwriters and other rightsholders depend on a number of different factors.
Every time someone listens to a song on Spotify, it generates royalties. According to this Hypebot piece, as of August 2020, Spotify was paying rightsholders a total of about $0.003 to $0.005 a stream - that’s about ⅓ to ½ a penny.
To be clear, this is the total paid to all rights holders on the song - that includes the master recording owners, whether a label or a self-released artist, as well as the songwriter and any publishers. Unlike most types of song usage, on-demand streams from services like Spotify, Apple Music, Tidal, or Deezer earn both a performance royalty (paid to songwriters directly and paid to publishers) and a mechanical royalty (paid to publishers).
The exact rate Spotify pays per stream depends on multiple factors - such as country and user account type (e.g. Premium vs. Free), as well as agreements major labels may have directly with the service. And it’s not an exact science: because Spotify uses its overall subscription revenue pro-rated per stream per artist to inform streaming rates, they could vary over time.
To put this in perspective: Assuming a $15 minimum wage (or $31,200 annually), at a presumed average per-stream revenue of $0.003, an artist would need $10,400,000 streams per year to earn a minimum wage income. And this estimate doesn’t incorporate distribution fees, publishing administration fees, or the costs of marketing and promotion.
The rates the different streaming services pay do vary. Soundcharts has an overview that estimates per-stream rate by service and across multiple countries.
With streaming service subscriptions continuing to grow - having gone up 24% in the US in 2020 over 2019 - and streaming royalties counted in micropennies, it is more important than ever to make sure that you’re collecting all the royalties you’ve earned as an artist and a songwriter. Songtrust collects performance and mechanicals for you for streams generated all over the world, via our global network of over 60 pay sources.
Learn more about streaming royalties on our blog!
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