Spotify has revealed that artists are paid an average of $0.007 per play on the music streaming service, following criticism that it is underpaying musicians. The figures, the first ever revealed by Spotify, where revealed on its new website Spotify Artists, aimed specifically at musicians. Spotify has urged artists to consider the bigger picture, not […]
Spotify has revealed that artists are paid an average of $0.007 per play on the music streaming service, following criticism that it is underpaying musicians.
The figures, the first ever revealed by Spotify, where revealed on its new website Spotify Artists, aimed specifically at musicians.
Spotify has urged artists to consider the bigger picture, not pay per play figures, asking them to think about the accumulative earnings from a successful album.
Explaining its business model, Spotify said it had paid more than $1bn (£612m) in royalties since its 2008 launch. It added that $500m (£306m) of the $1bn it has paid out in royalties was during 2013 alone.
Earlier this year Radiohead singer Thom Yorke pulled material from the site in protest at how much it pays artists.
Removing his solo album The Eraser and Atoms for Peace, a side project with Radiohead producer Nigel Godrich, Yorke tweeted that he was “standing up for our fellow musicians”.
“Make no mistake new artists you discover on #Spotify will no[t] get paid,” he continued on Twitter. “Meanwhile shareholders will shortly being rolling in it. Simples.”
Spotify said it has kept just 30% of the money from subscriptions to its premium service and advertising.
“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,” said Spotify on the site.
“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.”
This 70% is usually paid direct to record labels, who take their cut before it reaches managers and artists.
Using a series of charts, the Spotify website has illustrated how much a niche indie album could earn per month ($3,300) compared to a breakthrough indie album ($76,000), a Spotify top 10 album ($145,000) and what it calls a global hit album ($425,000 a month in royalties).
Currently with 6 million subscribers worldwide, Spotify said several artists were paid more than $3m (£1.8m) in 2013.
A set of ambitious predictions based on the site hitting 40 million subscribers estimated that a band with an album in the Spotify top ten could expect to get paid $734,000 a month in royalties, compared with the $145,000 it would get now.
Spotify’s new site also made the point that it pays out more than double that of a video streaming site such as YouTube.
