Comment by senko
16 days ago
> I don't like what they do to artists
Not sure if you're aware, but it's the labels, not Spotify:
> It pays roughly two-thirds of every dollar it generates from music, with nearly 80% allocated to recording royalties and about 20% to publishing, though how much artists and songwriters ultimately receive depends on their agreements with rights holders, which Spotify does not control. [0]
Spotify is frantically trying to escape the record label's death grip (hence podcasts), because they know they can squeeze it for just about anything with licensing deals. It's a terrible business model! Spotify keeps a third for their costs (& finally some profit in the past year or two), ie. about the same that Apple takes from App Store for basically nothing[1].
How the record labels convinced the world that Spotify is the bad guy here is beyond belief.
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[0] https://www.forbes.com/sites/sofiachierchio/2026/01/28/spoti...
[1] Certainly app store costs are nothing when compared to the infrastructure that Spotify needs.
Wow. This is certainly a take. Two things: 1. Spotify has had a policy for a couple years now of not paying artists who generate less than 1,000 streams per year PER song. So if I get 999 streams on each of my 50 songs every year, I get nothing from Spotify. 2. Major labels own major stakes in Spotify. They are one and the same.
If you dont get 1000 streams per year your are not a professional musician
There are 10s of thousands of pro musicians who don’t generate 1000 streams per year on many of the songs in their back catalog.
And the premise of your statement is that only pro musicians deserve to be compensated for their work. That’s a pretty messed up world view.
Ad. 1, I’m not saying Spotify is perfect, though in this case I would not be surprised if the algorithm was mandated by the record labels as the industry standard.
Ad 2, you’ll be surprised to hear the labels only held cumulative 20% stake up to the IPO and all of them subsequently wound it down. Their stake is now insignificant.
However, they had, have, and will always have, enormous leverage due to licensing-they’re monopolists and Spotify can either agree to whatever the terms are, or shut itself down.
Imagine if Netflix never started producing original content. They’d be at mercy of others or, more probably, already dead. Music doesn’t work that way and Spotify can’t just generate a bunch of pop hits to avoid paying the labels. They are trying to do that with podcasts.
Spotify here is the victim as much as the artists.
> Not sure if you're aware, but it's the labels, not Spotify:
*not only Spotify
They had plenty of problems from people abusing their system to steal listens from actual artists.
Their system is basically "one big bucket of listens" - if your song gets listens, you get money. So if you pay your sub, and listen to say 5 niche musicians only, it still all goes mostly to the most popular songs.
Now you might already notice the flaw here - if you say, make a bunch of bots that just listen to songs to boost their revenue, not only your sub doesn't pay artists you listen, but also to fraudulent ones.
Then there was problems with using fake collaboration tags, AI music to hijack artist profiles, and few others.
> Their system is basically "one big bucket of listens" - if your song gets listens, you get money. So if you pay your sub, and listen to say 5 niche musicians only, it still all goes mostly to the most popular songs.
That's basically how radio is accounted for in royalties, as well.
With Spotify knowing exactly who listened to what, it could be more precise (and arguably more susceptible to the fraud), but tbh what they do is standard (compulsory licensing) industry practice.
With radio, everyone that listens to a particular station is listening to roughly the same mix of songs, and they're "paying" (by listening to ads) on a per-hour basis.
If either of those was true with spotify, the unfairness would go away.
But when different listeners are paying very different amounts per hour, any correlation between payment amount and preferred content causes problems.
Spotify paid out ten billion dollars to artists in 2024. This is not small potatoes - total 2024 music industry merchandise sales was around $14b.
These big platform payouts matter a lot.
Correction: to record labels.
When you read artists' blog posts you can see they get peanuts. Not due to Spotify - due to the recording deals.
If you want an exhaustive but eye-opening account of all of the details, I recommend "All you need to know about the music business" by Don Passman.
This is the artists fault for signing with the labels. The labels own their music, of course they get the payment.
Whenever an actual artist reveals their earnings, it’s absolutely pitiful.
A quick search suggests a very steep drop off from the top earners.
‘At 100 million streams, artists can earn approximately $300,000-$500,000 in gross royalties. However, the actual amount reaching the artist varies dramatically based on their contracts. Major label artists receive $90,000-$150,000 after the label’s cut, while independent artists could keep $255,000-$425,000 after distributor fees.’ https://rebelmusicz.com/how-much-do-artists-make-on-spotify/