How Artists Get Paid From Spotify

If you are an artist searching for a way for your fans all over the world to stream and download your music, Spotify would be a good place to do that at. Spotify is one of the outlets that music lovers from all over the world visit to stream and download music from their favorite artists. Having your music on their platform, as well as the other major digital retail stores can really do wonders for your music sales.

Today I will be addressing how artists can benefit from being on Spotify and how much they can earn from every sale on this platform.

How Does Spotify Work

As I said Spotify is a website and platform that hosts music from artists from all over the world. Not only that but it also hosts podcasts and soon enough videos. It is among the top music retail sites that has changed revolutionized how people consume and purchase music online.

How it works is that Spotify has a free tier that is offered to anyone that signs up for their services. Once they have people using their free tier they then use strategies to drive users to their premium subscription tier. Their subscription tier is $9.99 (USD) per month.

How Does Spotify Make Money

As mentioned above Spotify has a Premium tier that it offers to its prospects. This Premium tier is valuable because it gives users unlimited music across all of their devices including smartphones, tablets and TVs.

Another cool thing bout the premium service is that users can also temporarily download songs to their devices so they can listen to their favorite artist on the go. Anywhere and anytime. The premium tier comes with no advertisement to the listener at the price of $9.99/per month.

How Much Has Spotify Paid Out To Artists

Spotify claims that it has always done its best to distribute all the funds owed to every artist that is due monies. This is not only done in America but every country in which they operate. Spotify says that they have now paid out more than $3 Billion USD in royalties to-date (more than $300m of which was paid out in the first three months of 2015 alone). These figures are said to be distributed to both major and indie artists.

As of November 2015, Spotify had over 75 million monthly active users with more than 20 million people paying a monthly subscription to use Spotify’s Premium tier.

How Much Do Artists Make From Spotify

An artist’s revenue from Soptify all depends on how much his/her music is streamed and download on the platform. Spotify has it set up to pay royalties for all of the listening that occurs on their platform by distributing nearly 70% of all the revenues back to rights holders.

Right holders are basically anyone who owns the rights to the music. This can be music publishers, record labels, or for an indie artist they would be the ones who own their own music.

Anyone who owns the rights to an artist’s publishing bought out that right or has that artist under contract to own some of or all of the publishing. Spotify retains roughly 30% of the revenue generated from artists.

Spotify Royalty Calculator

For all you artists out there that want to know a specific dollar amount that you can potentially earn based off of your streams on Spotify you can always use the Spotify Royalty Calculator. It simply calculates how much money an artist can make based off their streams. Simple enter any number into the seach box and press “Calculate” and the system will generate a dollar amount based off those streams.