How Much Does Spotify Pay Per Stream: Everything You Need to Know

As we discussed in our article on how to make money on Spotify, stream-based royalties are just one of many revenue streams for artists on the platform. While music streaming services were partly designed to help artists earn more from their music—especially in contrast to the era of digital piracy—the importance of streaming royalties as a key revenue source has been steadily declining. Why is that? Simply put, the pay-per-stream rates are way too low.

Spotify, specifically, pays artists an average of $0.003–$0.005 per stream, with a revenue split of approximately 70/30—meaning 70% of the per-stream revenue goes to the artists and respective rights holders, while Spotify keeps 30%.

Nevertheless, if it was as simple as earning a set amount per stream, there wouldn’t be much to discuss, right? But in reality, Spotify’s streaming payout system is far more complex.

Spotify, like other on-demand streaming platforms, operates on a so-called ‘pro-rata’ or ‘platform-centric’ distribution model. Now, we won’t bore you with technicalities, but let’s break down briefly what this means.

The term pro-rata, derived from Latin, translates to ‘in proportion,” and it describes a process or a model in which a shared asset will be distributed in equal portions. In other words, an amount, in this case streaming revenue, is assigned to one person according to their share of the whole.

In Spotify’s case, this ‘whole’ represents its total streaming revenue pool, also called the payout pool. This ‘accumulation’ refers to the total amount of money allocated for royalty payments each month, collected from Spotify’s monthly subscription fees, ad revenue from free users, and commissions, minus costs like taxes, transaction fees, and operational expenses. This pool is then divided proportionally among all releasing artists based on their respective streaming percentages, known as the streamshare.

For example:

• If all of Spotify’s users streamed 100 billion songs in a month and an artist’s song got one billion streams, their share would be 1% of the total streaming pool.

• Then, if the total pool contained $1 billion, that artist’s payout would be $10 million (before splits with labels, publishers, etc.).

Ultimately, this payout system ensures that artist royalties are directly tied to their streaming performance and fan engagement. However, this also means that a listener’s individual choices don’t affect where their money goes. Even if someone only streams small indie artists, most of their subscription fees may still go to top-charting artists with the highest overall stream counts. While this is indeed ‘in proportion,’ it raises questions about how fair or equitable the system truly is for all musicians.

Several factors determine how paid-out revenue is split among artists releasing music on Spotify:

1. Spotify’s total streaming revenue pool. This represents the total funds available for artist payouts, influenced by Spotify’s revenue and costs.

2. The negotiated global payout percentage. This is the portion of revenue allocated to artists and rights holders.

3. The total number of streams on the platform. The overall volume of streams on the platform in a given period.

4. Your total number of streams. Your share of the platform’s total streams.

However, this is not the full picture. In fact, some other elements can influence an artist’s earnings, and not all streams are valued equally. This means that different types of streams are generated under various conditions. As a result, the pay-per-stream rate is in constant flux for every artist on the platform.

You know how we just mentioned that not all streams are valued the same? Well, one major factor influencing Spotify’s per-stream payout is where your listeners are located. This is because Spotify Premium subscription fees vary by country, which means the revenue generated per stream differs as well.

For example, in 2022:

• In the US, subscribers paid around $0.004 per stream, while

• In the Czech Republic, the rate was 0.0021 per stream, and

• In Japan, it was 0.0033 per stream.

In other words, lower per-stream royalties in certain regions mean that users pay less; however, this also means that artists earn less when their music is streamed in those countries.

In addition to location, the type of your fans’ accounts is crucial in determining how much an artist earns per stream. The account type indicates whether a listener is on Spotify Premium or the Free Plan.

Premium users contribute more revenue to the platform, resulting in higher royalties when they stream your music compared to Free users, who generate revenue through ad sales.

While Spotify doesn’t negotiate individual rights agreements with artists, your earnings on the platform can be directly influenced by your distributor or label—especially regarding commission rates.

For example, some distributors take a percentage of your royalties, while others, like iMusician, offer subscribers zero commission on earnings from streaming platforms, making sure artists retain more of their revenue. Plus, as a Swiss company, we don’t charge any hidden fees like withholding taxes, keeping payments completely transparent.

As of 2024, Spotify introduced a minimum streaming threshold for royalty payouts. Under the new Spotify royalty model, tracks must reach at least 1,000 streams in the previous 12 months to generate ANY recorded royalties on the platform. If you have a track on Spotify that didn’t get 1,000 streams within the last 12 months, you will not generate any earnings (with this particular track).

According to Spotify, 99,5% of all streams come from tracks that meet this threshold, but the remaining 0,5% still cost the platform tens of millions of dollars every year. The company argues that implementing the policy eliminates “tiny payments” (e.g., tracks earning just $0.05 a month) that “typically don’t even reach an artist” and increases royalties for artists with higher stream counts.

Many have criticized Spotify for taking such steps, arguing that this change makes Spotify’s royalty system even more unfair. It favors commercially more successful musicians while making it even more difficult for independent and emerging artists to gain financial traction.

Also, let's not forget that when announcing the minimum threshold, Spotify stated it would focus on “working artists” more—as if (for now) less commercially successful musicians, who might be just starting out, don’t work hard enough. Policies like this make it increasingly difficult to support Spotify’s approach. And when media reports on so-called “Spotify fake artists” being intentionally featured in the platform’s editorial playlists to reduce royalty costs, it only adds to the skepticism.