One of the most frustrating things for artists (at least those who understand Spotify) is the way artists are paid. I’ve said I’m previous blogs that you might expect about £1 GBP for 400 streams. The ”about” bit is important because of the way that Spotify does their accounting.
So, each month people pay about £10 for a Spotify subscription. Of that Spotify take about £3 (30%) for themselves and the rest goes to paying distributors, labels and artists. The way that is divided up is to take all of the streams that have been on Spotify during that month and to work out what percentage of streams an artist had and to divide the pot up on that basis. So even if you never listen to Ed Sheeran (or Beyonce or Justin Bieber etc) if he had 3% of the overall streams on Spotify that month he’s still getting 21p of your subscription and those artists you really like are getting way less.
There is another way….
The has been much talk in recent years about “ER” or “equitable renumeration”. That would divine the money differently so that your subscription (or least the part Spotify hasn’t taken for themselves) would be divided amongst the artists that you actually listened to. So if a third of your streams came from let’s say a Rollerblaster artist such as Ben Rolfe or Ollie Weeks, £2.33 of your subscription would be heading their way and nothing would be going to Ed. As yet a change to this model is just a dream but there is pressure from some parts of the industry pushing hard for it. Needless to say, major labels and big stars are not so keen……..