Nobody has ever been totally clear on exactly how Spotify calculates royalties. There have been tons of guesses and averages over the years, but never a direct insight into how the company pays out. Until now, as Spotify has just launched a new website called Loud and Clear that attempts to demystify the process. Or as Spotify puts it themselves, "this site aims to increase transparency by sharing new data on the global streaming economy and breaking down the royalty system, the players, and the process."
The site is pretty extensive and features everything from a Q&A to a message from CEO Daniel Ek. According to Ek, the number of artists generating more than $50,000 per year is up 80%, $100,000 up 85% and $1 million up 90% since 2017.
The site further points out that Spotify has paid over $5 billion in 2020 alone and offers a few statistics about payment:
- In 2020, 184,500 artists generated over $1,000 in 2020, up from 89,700 in 2017
- In 2020, 7,800 artists generated over $100,000 in 2020, up from 4,200 in 2017
- In 2020, 870 artists generated over $1,000,000 in 2020, up from 450 in 2017
EK also points out that 57K artists represent 90% of monthly streams on Spotify, which has quadrupled in just six years. "This means that the number of the most listened to artists in the world is growing and more diverse," he adds. This is surely a blessing that Spotify has created the most desired platform for artists to showcase their masterpiece in front of the worldwide audience. However it is also necessary to have a certain amount of engagement to get noticed by the target audience. So learn how to buy Spotify followers to get more engagement.