Spotify reported that UK recording artists earned £750 million in royalties on its platform last year. The company revealed that nearly 1,000 musicians each generated at least £100,000 in royalties. These figures are part of Spotify’s “Loud and Clear” initiative, which aims to clarify how it compensates the music industry. However, Spotify cannot determine how much of those royalties reach individual musicians, as contracts between artists and their record labels or publishers vary in terms of revenue distribution.
In 2021, a committee of MPs learned that musicians typically receive around 16% of the royalties, meaning an artist who generated £100,000 on Spotify might only see £16,000 in royalties before taxes. However, Spotify is only one of several revenue sources for musicians. With roughly 50% of the UK music streaming market, artists could earn similar amounts from other platforms like Apple Music, Amazon Music, and Tidal.
Ed Sheeran was the most-streamed British artist on Spotify last year, with his music played 6.35 billion times, followed by Coldplay with 5.58 billion streams and Harry Styles with 5.11 billion streams. Despite their popularity, British artists did not make Spotify’s Top 10 global chart, which was dominated by Taylor Swift with 29 billion streams, along with artists like Bad Bunny, Peso Pluma, and Karol G.
The data suggest that non-English language music is becoming more successful globally. More than half of the musicians who earned $10,000 on Spotify last year are from non-English speaking countries. Although English-language music still holds the majority with 54.9% of the top 10,000 songs, its share is declining, with Hindi and Japanese gaining traction. Spotify UK’s head of artists and industry partnerships, Bryan Johnson, noted that genres like K-pop, Amapiano, and Music Mexicana are gaining global popularity.
Additionally, Johnson mentioned that 75% of royalties paid to UK artists came from international listeners, indicating significant opportunities for UK musicians in the global market as streaming continues to grow. He also noted that independent artists and labels received 40% of the UK’s royalty payments, totaling £300 million. Independent artists generally retain a larger share of their earnings, with some self-releasing artists keeping 100% of their income.
Spotify has faced criticism for a policy that demonetizes songs with fewer than 1,000 streams within a year, potentially cutting off royalty payments for these artists. Critics argue that this benefits top-tier artists while disadvantaging smaller musicians. However, Johnson defended the policy as a measure to prevent spam and fraud, explaining that the minimal revenue from fewer than 1,000 streams, about $0.25, often doesn’t reach artists due to distributors’ withdrawal thresholds.
In 2024, Spotify expects that this policy will redirect $40 million to more popular songs. Johnson emphasized that this money does not go to Spotify but instead supports emerging and established artists. This year is the first time Spotify disclosed UK payout figures, revealing the total has doubled since 2017. The company announced it paid $9 billion in royalties worldwide last year, making it the largest contributor to the music industry’s revenue. YouTube is considered the second largest revenue source, having paid $6 billion to rights-holders in 2022.
