Spotify paid $10 billion to music industry in 2024, reaching $60 billion total payouts

Spotify, the global leader in audio streaming, recently revealed it paid a remarkable $10 billion to the music industry in 2024. Since its launch, the company has distributed nearly $60 billion, a move aimed at addressing the ongoing debate about the platform’s compensation to artists. However, it’s important to note that these payouts encompass not only payments to artists but also to various other partners, such as publishers, which adds a layer of complexity to the figures Spotify shares.

The company’s announcement comes amidst criticism and public concern that artists are not being adequately rewarded for their creative work. Despite this, Spotify continues to highlight its role in the growth of the global streaming market.

Spotify’s VP of Music Business, David Kaefer, addressed the skepticism surrounding the company’s contribution to the industry, acknowledging that while many may overlook the significance of the numbers, the streaming model is working and continuing to evolve. Kaefer expressed confidence in the goal of reaching 1 billion paying listeners, an ambitious yet plausible target for the future of music streaming.

Spotify also emphasized its substantial contribution to global streaming revenues, underscoring that more than 10,000 artists now earn over $100,000 annually from the platform, a notable increase from 2014 when only a similar number of artists earned over $10,000 per year. Yet, despite the impressive payout numbers, concerns persist about the per-stream rates for independent artists. According to a report from music financing platform Duetti, Spotify’s payouts for independent artists are the lowest among major streaming platforms, offering just $3 per 1,000 streams. By comparison, services like Amazon Music, Apple Music, and YouTube provide significantly higher rates of $8.8, $6.2, and $4.8 per 1,000 streams, respectively.

Furthermore, as Spotify adjusts its pricing tiers, it has been noted that the average payout per stream has declined. This shift is exacerbated by the introduction of Spotify’s Discover Mode, a feature that boosts song visibility through algorithms in exchange for a reduced pay rate. This model has led to an increase in streams but requires artists to achieve significantly higher numbers to generate the same revenue, putting even more pressure on them to compete in an increasingly crowded market.

The competitive landscape for streaming revenue is more intense than ever. Luminate’s annual music report highlighted that an astonishing 99,000 tracks are uploaded to streaming platforms daily. With global streams reaching 4.8 trillion in 2024, a 14% increase year-on-year, the volume of content and competition continues to grow, making it ever more challenging for individual artists to carve out a substantial income from streaming.