Making money from music is one of the most important questions for musicians on Spotify. Since the platform enables artists to monetize their content and receive income, people want to know how to maximize it. Spotify is the most popular music platform in 2024, with over 200 million songs and nearly 11 million artists, and its audience is increasing daily. Every month, people upload nearly 1,8 million new songs. People say that Spotify is a Netflix from a world of music, and it’s hard to disagree with such a statement.
Still, if there are so many listeners, is it possible to build a stable Spotify income? Artists like 21 Savage or French Montana make millions on their streams. Can you do the same? In short, yes. However, to better understand your earning capabilities and calculate your revenue, you should know how much Spotify pay per stream, what affects the rate, and how you can increase the income.
How Does Spotify Work?
Spotify is a free music streaming platform where users can listen to their favorite songs, access playlists, and add tracks to their favorites. Still, the free version has several limitations. For example, you can skip only 10 songs per hour. Moreover, the sound quality is low. These limitations could be removed by purchasing Spotify Premium. Once you get this subscription, you get access to multiple features, including:
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Ad-free music listening
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An option to download music for offline listening
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Place songs in any order to play
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Better sound quality
- Listen to selected tracks with friends in real-time
- Create your own listening queue
On Spotify, you can select from four packages. It can be a default subscription, a package for students, a duo package, and a family version with up to 6 profiles.
When listening to similar songs, users receive recommendations. AI-based Spotify algorithm analyzes listening behavior, your search history, like/share activity, and other factors to offer the best possible suggestions. Also, all content on the platform cannot be exported, preventing copyright.
Last but not least, Spotify has a specific tool for creators to help them analyze their activity, see extended stats, and create content for user engagement. It’s called Spotify for Artists. Once you access it, you automatically verify your main account and receive access to new features. With this addition, you can:
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Effectively promote your music on the platform.
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Create “countdown pages” for users to pre-save your songs.
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Use the visual tool Canvas to give your tracks an awesome visual appearance.
Improve your artist profile by adding a bio, a main and background image, sharing information about future tours, selling merch, etc.
This is only a small part of what you can do to become better. If you are only starting your journey as a musician and you want to track your performance, you have to spend lots of time working with Spotify for Artists. Make notes, upgrade your profile, promote your songs, record videos for fans, do daily activities, etc.
To better understand how Spotify algorithms work read our article.
How Much Can You Earn on Spotify per Stream?
Now, to the main part. The first thing you should know is that every country where Spotify monetization is available sets a specific rate per stream. This means if you are located in the UK and have reached 1000 streams, you will receive £3,84. This is not a big secret because you can easily calculate your approximate earnings using the Spotify royalty calculator. Still, the calculator is not 100% accurate because it does not consider additional charges that could be taken from the artist. Remember that on Spotify, you don’t receive %100 of the payment. 70% is going to the musician, 30% – to Spotify. In the USA, artists will receive from $0,003 to $0,005 per stream. Moreover, the final rate depends on the type of subscription listeners use (free or premium).
How to Calculate Streams on Spotify?
You may hear about “The 30 seconds rule on Spotify”. It means that users have to listen to your song for at least 30 seconds to make it count as a stream. If they skipped it earlier, it won’t count. Moreover, the platform has changed the requirements and set a number of streams the song should achieve for the previous 12 months to generate royalties. Finally, musicians must hit a number of unique singers to unlock monetization for their songs.
Spotify Streaming Payout Explained
We already mentioned that payments for streams on Spotify are made in royalties. To better understand how much you will receive, you should know what type of royalties you will receive. There are two types of rewards. They differ depending on who receives them:
- Composers and publishers receive publishing royalties according to the location where the song is played.
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Distributors or record labels usually receive record labels if they hold rights to the tracks.
If we go deeper into that topic and talk about how the payout works, we should mention four core factors that impact direct income from music streaming. So, when you wish to know Spotify payout per stream, you should consider the following:
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Total streaming revenue pool on Spotify.
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The global payout, which is a percentage of a streaming revenue pool.
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The total number of streams on the platform.
- The number of streams you have on the platform.
It’s not a single revenue pool where everyone gets equal rewards. Spotify creates separate revenue pools for each subscription, local listening community, country, etc. Moreover, the fact that Spotify has various types of streams means that the revenue also differs.
In this video, the author explains what changes are coming to Spotify in 2024 and how they will affect musicians. For example, he mentions that the platform will generate one billion dollars for working artists withing the next five years.
Next, we should discuss two other types of royalties generated during music streaming. The first one is called mechanical, and it is paid every time the song is recreated or copied. The second one is performing royalties, and it is paid to artists and publishers on multiple occasions. If we talk about Spotify, performing royalties are paid for music streaming. Still, individuals can receive payment for live performances, live broadcasts, and radio airplay. For example, if you are registered for a live event, you will receive payment for your performance. The final calculation depends on the venue you are performing at. The higher the status, the bigger the price.
What Affects the Spotify Royalties?
When you want to calculate your potential income from music streaming on Spotify, you should consider 3 main factors.
- Your distribution agreement.
The amount of your payment depends on your agreement with the label or distributor. It means the person you sign your agreement with will influence your income on Spotify. Moreover, you won’t get 100% of the income because a part of it will definitely go to the distributor.
- Your listeners’ origin country.
Some users still don’t consider this fact, but the origin of your audience plays a crucial role in the overall income. Each country pays a different amount of money per stream, so if you have listeners from the UK and USA, you will receive different royalties for getting your music streamed.
- The subscription type your listeners use.
As you may know, Spotify has two main account plans: free and premium (paid). When users purchase Spotify Premium, they contribute money to the platform, which means they pay better royalties to artists. So, the more premium listeners you have, the better.
How to Earn More on Spotify Streams?
Since it becomes clear how much is a stream on Spotify and what factors affect the final calculation, musicians start searching for ways to raise their income. No one wants to stay on the current level and be satisfied with their existing earnings, so people seek to increase their income from streaming.
The key to getting a bigger number of streams can be achieved through effective music promotion. You significantly increase your engagement by showcasing your content to a wider audience, targeting listeners with similar music tastes and preferences. Use social media to share your music and present it to different audiences. Add a link to your Spotify profile, and create engaging previews for TikTok videos or Instagram Reels so people will immediately focus on your music and proceed to Spotify.
Remember about YouTube and its impressive promotion capabilities. Use YouTube ads to share your songs with the users on the platform. Create YouTube shorts using your most viral songs to get more engagement. Create a default music video, or think of telling a short story with your music in the background.
Independent artists who mastered Spotify and adapted here do not calculate their average pay per stream. They know exactly how much they earn per month using the available instruments and becoming successful musicians.
Get Targeted Spotify Promotion to Earn More on Streams
Besides working with social media, consider raising your content visibility by using music promotion services for Spotify. By trusting your profiles to experienced specialists, you will receive organic engagement (streams, likes, shares, saves, etc.) and increase your income. Curators don’t use bots or other fake tactics to get you more streams. Every stream is received from real users with the same music tastes, which means you also connect with the targeted audience.
Select a package that matches your goals and financial capabilities and get the best experience of music promotion on Spotify. Get plays or combined packages with followers and saves.
