Understanding Spotify royalties

Music on Spotify earns two kinds of royalties:

• Recording royalties: The money owed to rightsholders for recordings streamed on Spotify, which is paid to artists through the licensor that delivered the music, typically their record label or distributor.
• Publishing royalties: The money owed to songwriter(s) or owner(s) of a composition. These payments are issued to publishers, collecting societies, and mechanical agencies based on the territory of usage.

When an eligible song gets played on Spotify, the rightsholders receive royalties for it, whether it’s played by a Premium or ad-supported customer.

For detailed info on music industry economics and artist payments, check out spotify.com/loudandclear.

Songwriters and publishers, including members of the Ferrick v. Spotify USA Inc. lawsuit settlement class, can claim mechanical royalties from all digital music providers, including Spotify, through the MLC Portal maintained by the Mechanical Licensing Collective (MLC). Click here for more info

How we calculate and process royalties

We distribute the net revenue from Premium subscription fees and ads to rightsholders. To calculate net revenue, we subtract the money we collect but don’t get to keep. This includes payments for things like taxes, credit card processing fees, and billing, along with some other things like sales commissions. From there, the rightsholder’s share of net revenue is determined by streamshare.

We calculate streamshare by tallying the total number of streams in a given month and determining what proportion of those streams were people listening to music owned or controlled by a particular rightsholder.

Contrary to what you might have heard, Spotify does not pay artist royalties according to a per-play or per-stream rate; the royalty payments that artists receive might vary according to differences in how their music is streamed or the agreements they have with labels or distributors.

How artists and songwriters get paid

In many cases, royalty payments happen once a month, but exactly when and how much artists and songwriters get paid depends on their agreements with their record label or distributor - or collection societies and publishers in the case of songwriters. Once we pay rightsholders according to their streamshare, they pay artists and songwriters according to their individual agreements. Spotify has no knowledge of the agreements that artists and songwriters sign with their labels, publishers, or collecting societies, so we can’t answer why a rightsholder’s payment comes to a particular amount in a particular month.

For more information, see How the Money Flows.

Need more help?

For info more specific to you, or if you have an issue with your recording royalties, we suggest talking to your label or distributor since they handle the licensing and distribution of your music, and are the ones who administer your royalties.

If you have questions about publishing royalties, you can reach out to your publisher, performing rights organization, or collecting society.

In November 2023, we announced some upcoming changes to our royalty policies. Learn more about these announcements here