Understanding royalty payments is a necessary piece of information for any artist. Parsing through music streaming platform policies and terms of service can get confusing, so we decided to plainly break it down for the most popular music streaming platform to date: Spotify.

Below, we'll break down what you need to know about Spotify royalties so that you can understand how much you get paid per stream, how Spotify royalties work, and how to get paid as an artist.

What Are Spotify Royalties?

Spotify royalties are the amount of money that Spotify owes rights holders (artists, songwriters, labels, etc.) in exchange for a song being streamed on a particular platform. Royalty payments are not fixed and can shift from one platform to the next: i.e. Apple Music, Tidal, and Amazon Music have different royalty rates surrounding royalty payouts.

How Much Does Spotify Pay Per Stream?

Spotify royalty payouts fluctuate over time, with the general consensus showing that the platform has paid out less per artist over time (though this isn't uncommon amongst streaming platforms.) Record labels and certain distributors might also have specialized terms with the platform that provide you with a more advantageous cut than that of an independent distributor with no barrier to entry.

With that in mind, Spotify pays out an average of $0.003 and $0.004 per stream as of 2024. This assumes that you are earning 100% of the royalties as the sole owner of the master recording and publishing. In cases where there are multiple songwriters, collaborators, or those on the backend like a record label, you will likely earn less since these parties take a cut of your royalty earnings.

Understanding Spotify Royalties and Copyright

Royalties are not as simple as what you earn from a platform like Spotify. Rather, royalties are earnings owed to the parties that own your music's copyright, publishing, and master rights. Generally speaking, your royalty payouts are divided into two groups:

• Master Rights Holders: Someone who owns a recording "master" owns the final, recorded version of your song. Artists, labels, or a mixture of parties usually hold rights to a master recording.
• Composition or Publishing Rights: These rights, otherwise referred to as songwriting credits, are owed to those who created the lyrics, melodies, and occasionally, compositions of any particular song.

The Different Types of Royalty Payments

Whenever you earn royalties from music, you are earning one of the following types of royalties:

Mechanical Royalties

Mechanical royalties speak to payouts that are generated as a result of reproducing your master recording into a physical copy. These royalties are issued whenever someone buys your song, a CD, tape, or vinyl, for instance.

Public Performance Royalties

Public performance royalties are generated whenever a song's composition is played in public. This could be through a live performance, a song played in a public setting like a coffee shop, or use in another piece of media. These royalties are calculated through performance rights organizations, or PROs.

Interactive Stream Royalties

These are the specific types of royalties you're earning whenever your song is streamed on a platform like Spotify or Apple Music. Interactive stream royalties often vary from one platform to the next.

How Do I Collect Money From Spotify Streams?

You will collect mechanical royalties and streaming royalties directly through your distributor, whether that's an independent distributor or a record label. Public performance royalties are collected through Performance Rights Organizations, or PROs. You need to sign up for a PRO (some common examples include ASCAP or BMI) and input your information so that you can collect your performance royalties.

Spotify's 2024 Royalty Changes

It's important to note that Spotify's royalty payments do come with an important caveat as of 2024. Per the platforms' official statement , "tracks must have reached at least 1,000 streams in the previous 12 months in order to generate recorded royalties."

This means that in order to earn royalties from Spotify streams, each of your tracks on an annual basis must reach 1,000 streams before you're eligible to earn  payouts for that particular track. Spotify is the only platform that has set this precedence with recording royalties, but it remains to be seen if other platforms will follow suit in the future.

Spotify Royalties FAQ

Understanding the ins and outs of different streaming services can get confusing. If you're still parsing through the breakdown of Spotify's streaming royalties, consider these commonly asked questions and answers surrounding music recording royalties:

How much does Spotify pay for 1,000 streams?

Assuming that an artist earns between $0.003 and $0.004 per stream, you can expect Spotify to pay out between $3 and $4 per 1,000 streams. This also assumes that an artist has full ownership of the master and recording rights.

How much does 1 million streams on Spotify pay?

Based on this Spotify royalty calculator , we can estimate that Spotify pays about $3,400 per million streams. It's important to note that with any Spotify royalty calculator, it's assumed that you own 100% of the publishing and master recording rights which isn't the case for many artists at this scale.

How many plays on Spotify does it take to make $100?

It's hard to say how much it takes to earn on Spotify since royalty payments are calculated on an individual basis, but if we assume that music royalties are paid out at an average of $0.0033 per stream , it would take around 30,303 plays to generate $100 from streams. This assumes that you own 100% of the streaming and publishing royalties.

Does Spotify pay royalties per stream?

As of 2024, the answer is kind of - Spotify has made it so artists have to earn 1,000 streams per tracks annually in order for that track to generate royalties delivered back to the user. Once that threshold has been met, it's estimated that each stream earns an average of between $ 0.003 and $0.004 .

How much money does 100,000 streams on Spotify make?

The exact amount any artist earns off of Spotify royalties varies heavily on a wide variety of factors. If we're basing it off of a rough average determined by this streaming calculator , we can estimate that artists make about $238.00 from 100K streams, assuming that they own 100% of the royalty share.

All music streaming platforms have their own specifications when it comes to paying out music streaming royalties, but they are fairly similar across the music industry. Hopefully, this guide provides you with the knowledge you need to collect your royalty payments from Spotify.