Spotify announced that it paid $7 billion to music industry rightsholders last year, accounting for nearly 25% of the industry’s total revenue.
The news came on the company’s Loud And Clear website, which launched last year with the goal of increasing “transparency” around its payments.
The streaming giant said 52,600 artists made more than $10,000 (£7,500) from Spotify in 2021.
Of these, 130 have been paid more than US$5million (£3.8million) in the past 12 months.
Spotify didn’t name any of the artists involved, but his most streamed acts over the past year have been Bad Bunny, Taylor Swift, BTS, Drake and Justin Bieber; while the most streamed song was Olivia Rodrigo’s Driver’s License.
However, the streaming giant’s raw numbers don’t tell the whole story.
For example, an artist whose music earns $10,000 in Spotify royalties may only get $2,000 once the record label and publishers take their cut. For a seven-piece band like BTS, that $2,000 is split sevenfold.
Songwriters and session musicians are paid even less, and many struggle to make ends meet.
Still, Spotify’s data does provide some insight into how artists are faring in the streaming era – with earnings falling into the following brackets:
- $10,000 – $49,999: 36,100 artists
- $50,000 – $99,999: 7,000 artists
- $100,000 – $499,999: 7,330 artists
- $500,000 to $999,999: 1,130 artists
- $1,000,000 – $1,999,999: 590 artists
- $2,000,000 – $4,999,999: 320 artists
- $5 million and up: 130 artists
About 28% of artists who made more than $10,000 last year (roughly $15,140) uploaded their own music through TuneCore, Ditto, DistroKid, and CD Baby — meaning they kept the majority of their earnings.
Spotify also estimated that most of these artists will have made around $40,000 (£30,000) after accounting for revenue from competing streaming sites and CD sales over the past year.
Of course, the musicians we are talking about represent just the tip of a very large iceberg.
About eight million people have uploaded tracks to its service, according to Spotify, and 60,000 new songs are added every day. As a result, 99.3% of artists on Spotify generate less than $10,000 per year.
The company counters that more than half of the eight million artists in its database have fewer than 10 tracks uploaded, “so they’re pretty early on in their journey, or maybe they’re doing it more as a hobby,” said Spotify’s Global Head of Music Product. Charlie Hellman, in an interview with Music Ally.
He added that the number of artists making more than $10,000 has increased by 10,100 in the past 12 months – and that “the industry is half as top-heavy and half as star-centric as it was in the CD heyday “.
- Global music spending rises to $26 billion
- BTS was the best-selling act in the world last year
- Apple and Spotify reveal the most-streamed songs of 2021
This is the same argument made by the broader music industry, which claims that more artists are making a living in the streaming era than at any time in history.
The BPI, which represents the UK music industry, says nearly 2,000 artists scored more than 10 million UK streams in 2021, up 25% from 2020.
“The rise of streaming has empowered more artists than ever – from all backgrounds and eras – to build new fan bases around the world and forge successful careers in music,” said BPI chief executive Geoff Taylor in January.
Earlier this week it was revealed that total music industry revenues rose by 18.5% to $25.9bn (£19.5bn) in 2021, the highest level since records began in the 1990s.
On its Loud And Clear website, Spotify boasted about its contribution to that number, claiming that its “7 billion grand total was the era of CD or digital download.”
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