Half of Spotify revenue confirmed going to Indie Artists
Spotify CEO Daniel Ek Leon Bennett/Getty ImagesSpotify updated its annual Loud and Clear report on Wednesday, confirming that for a second consecutive year, the streaming giant paid out half of its royalties to independent artists. Of the $10 billion Spotify doled out to music rights holders last year, it gave about $5 billion to indie labels and artists, the company said, a $500 million increase from 2023. “It speaks to opportunities and choices that artists have today,” Sam Duboff, Spotify’s global head of marketing and policy for the music business, tells The Hollywood Reporter. “A lot of what streaming and Spotify has enabled is for artists to be in more control over how they want to navigate their career. You’ve got tons of artists choosing to go the major label path getting life-changing advances and resources that come with that, you see indie labels in the middle with some of those same services but artists getting a larger cut, then you’ve got tons of fully independent, DIY artists who are keeping 100 percent of their royalties and promoting themselves.”The report comes weeks after Spotify announced its first-ever full year of profit, 18 years after the company was founded in 2006. Spotify launched its Loud and Clear initiative back in 2021 in an effort to increase transparency with artists and contextualize how the streaming service pays for music. While Spotify and the streaming era have helped reinvigorate the record business after years of decline amid rampant piracy in the 2000s, the company has received consistent criticism from artists — particularly smaller, independent artists — about paltry sums for their streams. Today’s report likely won’t quell many of those critiques, as a majority of the songs on the platform don’t get enough streams to even be eligible to get monetized. Spotify also irked the songwriter community last year over its controversial bundling strategy that led to songwriters getting paid a lower royalty rate.The Mechanical Licensing Collective sued Spotify over the bundle strategy, though a judge dismissed the suit in January. In the new Loud and Clear report, Spotify said it paid out $4.5 billion to songwriters and publishers in the past two years."The growth of people uploading music is always going to outpace the growth rate of the number of people making it,” Duboff says. “We see our role as providing as much transparency and data about our role in the ecosystem as we can, and our hope’s been that would inspire more transparency from other parts of the ecosystem. No other streaming service has published transparent data about their payouts or how many artists are generating different amounts. Obviously there’s a lot of narratives people talk about when talking about royalties; I think over time the data and facts will start to overwhelm the narratives.”Spotify updated its annual Loud and Clear report on Wednesday, confirming that for a second consecutive year, the streaming giant paid out half of its royalties to independent artists. Of the $10 billion Spotify doled out to music rights holders last year, it gave about $5 billion to indie labels and artists, the company said, a $500 million increase from 2023. “It speaks to opportunities and choices that artists have today,” Sam Duboff, Spotify’s global head of marketing and policy for the music business, tells The Hollywood Reporter. “A lot of what streaming and Spotify has enabled is for artists to be in more control over how they want to navigate their career. You’ve got tons of artists choosing to go the major label path getting life-changing advances and resources that come with that, you see indie labels in the middle with some of those same services but artists getting a larger cut, then you’ve got tons of fully independent, DIY artists who are keeping 100 percent of their royalties and promoting themselves.”Bill Simmons Signs New Contract at SpotifyThe report comes weeks after Spotify announced its first-ever full year of profit, 18 years after the company was founded in 2006. Spotify launched its Loud and Clear initiative back in 2021 in an effort to increase transparency with artists and contextualize how the streaming service pays for music. While Spotify and the streaming era have helped reinvigorate the record business after years of decline amid rampant piracy in the 2000s, the company has received consistent criticism from artists — particularly smaller, Spotify’s update also reflects more global music hitting the mainstream. Music in eight different languages generated more than $100 million last year, Spotify said: English, Spanish, German, Portuguese, French, Japanese, Korean and Italian. In 2017, it was only Spanish and English. Meanwhile, the languages with the biggest growth in royalties last year were Greek, Telugu, Turkish, Polish and Arabic, Spotify said.“What we’re seeing is a surge in artists from less matured music markets able to tap into the global royalty pool, and new types of music succeeding and careers being possible that wouldn’t have been conceivable 20 years ago,” Duboff says.
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