What Streaming Music Services Pay (Updated for 2018)

What Streaming Music Services Pay (Updated for 2018)

Find out what top streaming services — including Spotify, Apple Music, and Amazon Music — actually pay per play.

Update: We’ve since published an updated list for 2019, which you can view here.

Thanks to streaming music services, record labels reported record-breaking revenue last year.  In 2017, the ‘big three’ made an estimated $14.2 million a day from streaming services like Spotify and Apple Music.  Universal Music Group alone made $4.5 million each day last year.

Despite increasing revenue from plays, how much do artists actually earn?

In our report published last year, Digital Music News found that Napster had the highest payouts.  After just 90,000 plays on the platform, artists would earn the US monthly minimum wage of $1,472.  In contrast, Spotify and YouTube, arguably the largest streaming music services, had the worst payouts.  The Swedish music platform had a per-stream rate of $0.0038.  With over 1.1 billion users, artists would receive just $0.0006 per play on YouTube.

So how are things one year later?

This year, The Trichordist took a look at the most recent data from a major indie label.  The label has a catalog of 200+ albums that generate over 200 million streams annually.  It’s a representative sample, though it still excludes closed-door deals with major labels (including hefty advances and preferred advertising slots).

In today’s article, we’ll only list the streaming music platforms with reported US market share amounts.

Groove Music takes the top spot.

Surprisingly, Microsoft abruptly announced late last year that it would exit the streaming music market.  With few users lining up behind the service, the company just couldn’t compete against established market leaders.

That’s too bad, because Groove actually had the highest per-stream payouts.  The Trichordist found that Groove Music (listed as Xbox Music) paid $0.02730 per play.  Though it ranked the highest on this list, it had the lowest streaming music market share of 0.65%.

This explains why Microsoft abandoned the streaming music market altogether.

Napster may no longer be the king of streaming payouts, but it still has significantly higher artist revenue payouts.

As explained earlier, Napster topped our list last year as the platform with the highest artist revenue paid out per-stream.

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According to The Trichoridst, Napster (listed as Rhapsody) paid $0.01682 per play.  It had a 1.75% market share.

Don’t count TIDAL out just yet.

Despite Jay Z and Beyonce’s massive star power, few people have yet to actually sign up for TIDAL.  Last month, Digital Music News found that the high-fidelity streaming music service had less than 180 days left before it ran out of cash.

Dismal subscription numbers haven’t stopped Jay-Z’s streaming service from providing significantly higher artist revenue payouts.  Last year, the service reportedly paid $0.0110 per play.  This year, The Trichordist found that the platform paid $0.01284 per stream.  It had a 1.76% market share in the US.

Fourth place: Apple Music.

Unlike rival streaming music platform Spotify, Apple Music doesn’t have a free tier.  That partly explains why it offers a significantly higher per-play rate (Apple also voluntarily offered elevated payouts for mechanical publishing).

In 2017, the service paid $0.0064 per stream.  This year, the number has risen to $0.00783.  Apple Music reportedly has a 22.29% market share in the US streaming music market, placing it right behind Spotify.

Amazon proves that providing two separate streaming music services can actually boost numbers.

So, how well is Amazon doing in the streaming music arena?

Combining Amazon Prime Music and Music Unlimited, Amazon reportedly has 16 million subscribers.  Recent estimates actually put the platform ahead of Apple Music, which last reported “well over” 30 million subscribers.

Yet, it’s difficult to actually tell.  The e-commerce giant remains notoriously quiet on the subject, fiercely guarding any artist payout reports.  This year, though, The Trichordist found that the streaming platform pays $0.0074 per play.  Amazon has a combined 3.80% market share.

Sixiéme place: Deezer.

French-based streaming music service Deezer still doesn’t have a large presence in the United States.  Or, according to a few reports, at least not just yet.  The established streaming music platform is available in over 180 countries and has over 40 million licensed tracks.

Last year, the service paid $0.0056 per play to artists, slightly lower than Google Play Music.  This year, the streaming music platform’s per-stream rate jumped to $0.00624.  The platform has a 3.24% market share in the US.

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Google Play: the former payout king continues its slow descent into terrible payouts.

In 2015, signed artists on Google Play Music reportedly earned $0.0179 per play.  That number sharply decreased to $0.0059 last year.

Right behind Deezer, the per-stream rate now stands at $0.00611.  It has a 4% market share in the States.

Top executives at Spotify make millions while artists endeavor just to earn pennies.

At well over 60 million, Spotify has the highest number of paid subscriptions.  Ahead of its Wall Street offering, the company’s valuation has skyrocketed to $19 billion.  Top executives at Spotify reportedly earn seven-figure salaries.

So, how are artists faring on the platform?  Not so well.

Last year, the service paid out $0.0038 per play.  Not much has changed this year.  With a reported 51.51% market share in the US, Spotify pays $0.00397 per stream.

From seventh to ninth place, Pandora struggles on.

Founder and former Pandora Radio CEO Tim Westergren promised investors that the company would make a profit last year.

2017 came and passed.  Now, Pandora Radio remains on death watch as the stocks struggles to recover from historic lows in November.

In our report last year, Pandora Radio landed in second-to-last place with one of the worst artist payouts.  Not much has changed.  The Trichordist found that Pandora Radio paid a paltry $0.00134 per stream.  This, despite having the third highest market share in the US of 7.86%.

Once again, don’t ever expect to make money on YouTube.

Google has Google Play Music.  In 2015, the search giant launched YouTube Red.  Now, in less than a few months, the company will launch yet another streaming music platform.  So, will the third time be the charm?

Based on Google’s track record with Play Music and YouTube, not bloody likely.

Last year, at $0.0006 per play, the video platform had the worst artist revenue payouts.  With a questionably low 1.70% reported market share in the US, YouTube paid a paltry $0.00074 per stream.

 

For detailed information on streaming music service payouts, you can view the complete image below.  You can also check out The Trichodist’s original report here.

 

Image by The Trichodist

 


Featured image by geralt (CC0)

22 Responses

  1. Avatar
    Anonymous

    A comparison of the per-pay rates doesn’t mean a hell of a lot without an understanding of how those per-play rates are calculated. It’s actually a very simple fraction: the royalty pool divided by the number of streams. The royalty pool is a percentage of the revenue the service earns during the month from subscriptions and advertising.

    The reason Spotify has a low per-play rate is because its listeners are spending a lot of time listening to music on the service. It’s an all-you-can-eat service, and people are eating much bigger meals on Spotify than they are on other services. The more plays a service has, the lower the per-play rate is.

    The reason Groove has such a high per-play rate is because so few people with subscriptions were listening to it. Gamers used it when they’re playing their X-Box games, but otherwise it didn’t really catch on like the other services have. I bet that’s one of the reasons it shut down.

    If you want to get a good idea of how much services are actually paying to copyright owners (or at least what they should be paying, if they were using only those works that are identified and licensed), look at the royalty pools instead of the per-play rates. It should be on those same statements that David Lowery looked at.

    • Avatar
      Seb

      Yes, it is an all you can eat listening on Spotify. But so it is with Apple, Google, Amazon and other streaming services. So I don’t really get why you think Spotify is different to other services in this regard.

    • Avatar
      Anonymous

      It has to do with all the artists. There are too many “employees” to pay out so wages are lowered. Simple as that.

    • Avatar
      Rick

      Now THIS is the beginning of a great article, thanks for explaining

  2. Avatar
    Funny Industry

    Interesting that David Lowery calls out Rhapsody / Napster for having a high per play rate, but he still sued them.

    • Avatar
      Anonymous

      A high per play rate doesn’t mean that much if you’re not actually paying those royalties.

  3. Avatar
    Uwe

    New and fresh money flows into the music market. A good report on this can be found here, for example:

    https://www.economist.com/news/business/21734488-its-clout-streaming-could-allow-it-sign-new-artists-itself-challenging-major-record

    Decades of decline have come to an end thanks to Spotify. However, Spotify itself is not yet operating profitably, but is designed for rapid growth in the billions. Artists rightly complain that many of them get stuck with the labels and never get through clean and fair to the artists, but they could now close almost directly with spotify and would no longer need the labels for their careers. But this is not seen everywhere. A prominent spotify critic (and Apple flatterer) is David Lowery. Every year he brings new calculations, which is supposed to be so good at Apple and so bad at spotifying. However, he has had such good experiences with the historically important iTunes as a source of paid downloads that it is difficult to reorientate himself. Today, however, the music plays somewhere else.

    Apart from the emotional spotify aversion, the weak point of his calculations is the very narrow data basis. Only the US market is evaluated. Data analysis is limited to just one of many thousands of labels. The analysis only includes about 200 albums. The solo artist with a degree in mathematics has only about 75 listeners a day at Spotify with his more recent publications. This is certainly very frustrating when you see yourself as a big indie star, who can still count well and fights for a better pay for his fellow artists.

    Many artists such as David Lowery, who have set highlights of their musical career in the time of the “robbery-murder-copiers”, are still embittered even today for lack of further successes and continue to be very critical of streaming. Reason, however, forces you into this continuous system of monthly and regular payment. Even David Lowery manages to make fresh new money with “old creations”, especially thanks to the rapid growth of Spotify. With his foundation of the band “Cracker” from the late 80’s he still reaches almost 240,000 listeners daily at Spotify and with “Low” he has a successful “Alt” track which was played over 10,000,000 times. Link: https://open.spotify.com/track/6ctbCIikHbC6tSOL1rewQX

    With such frequencies, it’s no surprise when you’re battling for fractions of a penny and you’re critical of everything that’s worse than any other song.

    Even with the band Camper Van Beethoven, which was founded even earlier, David Lowery has two music titles at the start, each of which reaches over one million streams. Of course you can only get mega-rich with streaming rewards if you are a current mega-star, but for the first time also older indie-bands that don’t sell any more significant quantities of CDs or LPs are taking money again and again. In the past, many of them only received a small advance payment from the label and then had to watch how the rest of the money was spent on sales and production. Everything has changed for the better, but the contracts between labels and artists have to get even better.

    But what exactly do his calculations tell us?

    Even for older indie albums there is still a steady flow of money, although the smaller listeners already have an LP, CD or a download, even for older Indie albums, unless there is a rap-mord-copy, the pandora radio stops and music lovers are lured from YouTube to Spotify, Apple & Co. Today, the majority of listeners hear different things and yet, as a customer and fan, you can still traditionally hang out. This new and additional cash flow is probably the reason why even the toughest critics like David Lowery are granting Spotify licenses. One wants to be heard and not appear in the catalogue of a dying market supply. Usually, you even advertise with Spotify for a fee to become more popular.

    The fact is that there is a clear correlation between the level of remuneration and the very active or very passive use of a music service. This is how David Lowery himself calculates that the highest remuneration for Groove Music (formerly Xbox Music) is paid. Then follows Napster (formerly Rhapsody) and Tidal. Thus, all candidates where we have heard about the termination of the service (Groove) or where it is speculated that the money will soon no longer be enough to continue (tidal) or where the decline in the number of customers has been very evident for years (Napster/Rhapsody). Is it any different with the next Apple that comes out on top? Certainly not. It is known that Spotify is used up to 10 times more than e. g. Apple. Anyone who can calculate and how David Lowery studied mathematics should know what that means for the payment per song, because the paying customer always gives a monthly fixed amount. Today, this is quite similar for all music services. However, because David Lowery does not have enough data, he not only compares the pure payment offers, but also puts all free offers in his calculation grid.

    Since he comes to the conclusion that Apple is paying less and less per stream and spotify in the current trend (multi-year studies), smart computers can quickly imagine what this means for actual use in the current trend. Apple is sinking here! With family and annual subscriptions, Apple has also tended to lower prices, which makes it even more obvious. If Apple, with allegedly rising user numbers (exact data, unlike Spotify, which has not been mentioned for months), leads to increasing fees per stream, the actual usage per customer must have gone even further down the drain at Apple. That also explains the purchase of Shazam. Couldn’t they give good personal recommendations before and is Apple really more competitive with Shazam?

    Translated with http://www.DeepL.com/Translator

  4. Avatar
    fail

    all of you f*cks who can’t stfu how spotify pays more cuz they bigger.

    A person is going to listen to a song a limited amount of times
    Is the listening worth more on sh*tify or elsewhere? DO THE MATH.

  5. Avatar
    Adam

    I’m amazed that 10 years into streaming and people are still talking per-stream rate as if it’s the most important metric.

    As mentioned in an above comment – Spotify has a HUGE amount of streams. They spend enormous amounts of product development to get people to listen to more music. For music to never stop.

    As an artist – isn’t that what you want? Fans to listen to your songs over and over and over again?

    Don’t you want people listening to more music?

    All of that will drive down the per-stream rate. But the OVERALL pie keeps growing and that’s what matters most.

  6. Avatar
    Joseph K

    “Billboard currently calculates 1,500 streams to one album for the purposes of charting, which at current streaming rates (at Spotify) actually sorta matches an economic equivalent. But that’s just backing out of an arbitrary rate set by Spotify, it doesn’t actually define what the cost of a stream should be.”

    Yawn. Typical drivel by David Lowery.

  7. Avatar
    darksidejosh

    Nothing holds a candle to:

    https://musicoin.org/

    Pay Per Play model using UBI (universal basic income) utilizing blockchain technology. 1 play gets the artist 1MC, the value of which has been up to $.10 (per play) in the last 6 weeks. Listeners are also able to tip the artists with MC, and the entire scenario is AD FREE and FREE TO USE. The platform is young, and is experiencing enormous growth. It would be wise, if you are an artist, the get on board now.

  8. Avatar
    Vin

    Sounds like record companies are a big part of the problem. I rarely hear anything good about these people.

  9. Avatar
    Jerry Bolton

    Artist like myself and others put in a lot of time and effort to produce music for the general public. We deserve to be handsomely compensated for our hard work.

  10. Avatar
    Steve Freedom

    A decade ago a musician’s market came in well below 1x billion people. Only a handful of the most supported artists could ever look forward to going Platinum, some 500,000 units worth $1m.
    Now an Artist can instantly reach 7x billion, and make music for gaming, movies, tv, broadway, podcasting, dj-stems – options abound!

    Emotionally we balk at the pittance paid-per-stream, which is a math problem that feels like we’re counting 64-beats-per-bar – like grappling to understand the financial decision made by Taylor Swift for leaving Spotify in 2015 when she moaned that her 8x million in revenue didn’t add up to her 12x million plays on Spotify per month.

    Today’s listener consumes more gaming-music and video-music in a month than their parents did in a decade, and this music is being streamed via compressed audio of 128k-mp3-types to ear-bud-style headphones or whatever cheap-tech comes to hand – so today’s listener demands less sophisticated sound, just a whole lot more of it. Artists can expect to make more music more of the time, with lesser emphasis on production and lower costs per release.

    Contrary to speculation, phase-shifting-sands, or the freely abundant musicality native to all creatures inhabiting those 29 new moons we discovered orbiting Jupiter, the life-long committed musicians found here on earth care more about living the musical life and laying their hats in a thousand smiling homes.

  11. Avatar
    Vybz Fmp

    So i read through all the comments on here and couldn’t still find which streaming services pays legit!