“Songwriters are generating record-breaking revenues via streaming services”: Spotify releases its annual Loud & Clear Report
The report explores the analogy made by Spotify CEO, Daniel Ek, in which he compares being an artist to playing professional football.
Image: Jakub Porzycki / NurPhoto via Getty
Spotify has released its annual Loud & Clear Report, which provides a deep dive into music streaming economics. Over the last year, Spotify says that it “set the record for the highest annual payment to the music industry from any single retailer” in a round up of its key findings.
It also states that it has paid out “record revenues” for rights holders, despite ongoing criticism of the streaming giant for how it currently compensates artists. Spotify’s royalty rate averages between $0.003 – $0.005 per stream, and a Living Wage for Musicians Act has recently been put to US congress in the hopes of making streaming platforms pay a minimum of a penny per stream across the board.
The report also doubles down on comments made by Spotify CEO, Daniel Ek, who compared being a musician to playing sports in a video posted online. It reads, “When it comes to building financial opportunities, we’re focused on those most dependent on streaming as part of their livelihood: these 225,000 emerging and professional artists that are building careers.
“As a point of comparison, FIFA estimated there are hundreds of millions of people who self-identify as ‘footballers,’ but 128,694 people are actually getting paid any amount of money from it. While music and sports are quite different, this demonstrates how widespread the aspiration is to participate in creative and athletic pursuits and make a living from them.”
Elsewhere in the findings, it says, “Every year, Spotify has paid out more and more money in streaming royalties, resulting in record revenues and growth for rights holders on behalf of artists and songwriters. These rights holders include record labels, publishers, independent distributors, performance rights organisations, and collecting societies.
“Spotify royalties are powering artists’ careers at all stages. In fact, the number of artists generating revenue at every threshold shared on this site – from $1,000 through $10 million per year – has nearly tripled since 2017.”
Spotify argues that as these figures represent revenue generated from Spotify alone, when taking into account earnings from other services and recorded revenue streams, these artists likely generated 4x this revenue from recorded music sources overall, and that they may have made additional revenue from concert tickets and merch sales.
The report also states that Spotify paid out nearly $4 billion to publishing rights holders over the last two years, adding that “Songwriters – through their publishing rights holders – are generating record-breaking revenues, driven by streaming services”. It also says publishers, songwriters and their CMOs (Collective Management Organisations) are seeing “more than 2x the revenue ($5.5B in 2022) in the streaming era than they ever had in the CD/sales era ($2.5B in 2001)”.
Read the Loud & Clear key findings round up over at Spotify.
