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Music Streaming Royalties Calculator For All Services


Calculating your music streaming royalties is essential to helping you understand whether a music career is viable, and what goals you need to reach to become full-time from streams alone. However all streams are not made equal, and many factors like your chosen distribution service, label deal, and country of the fanbase can all alter your earnings.

We spent hours diving deep into this below, so read on to find out how you can maximize your stream revenue and what you should know about choosing a distribution service.

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How Do Streaming Services Pay Artists?

Each streaming service operates slightly differently when paying artists, but they all follow the same basic system – earn money through advertising revenue or paid subscribers, pool this money together, and distribute it evenly among artists, based on the number of streams they accrue for the service.

Streaming royalties are not directly paid to artists either. They are paid to their rightsholders.

Rightsholders are chosen by the artist and could be a record label, a music distribution service, royalty collection society, or any other service that owns the rights to the music in question. The rightsholders then pay the artists based on their contractual agreement with the digital service provider (Spotify, Tidal etc).

Therefore the way this money is split is different when talking about Spotify than it is Apple Music because each rightsholder will have a different agreement with each DSP.

For instance, Apple Music seems to be a bit fairer, offering $0.01/stream, where Spotify on average shares 2/3rds of profits with the music (33% Spotify cut, 66% artist cut).

All Streams Are Not Made Equal…

Unfortunately, to make it even more confusing, all streams are not made equal.

Streams have multiple factors that affect the pay-out, and they are as following:

  • Deal your DSP has with streaming service
  • Subscriber status (free or paid)
  • Country of stream (a stream from U.S. will earn more than a stream from Yemen for instance)
  • Length of stream/time of user on platform
  • Number of ads seen/clicked/conversions made

With different tiered subscription costs and different advertising revenues based on the country those adverts are shown to, each stream will have a different pay-per-stream value.

As stated above, streaming services earn money through advertising revenue and paid subscribers. Due to different economical situations in varying countries, advertisers will pay less for advertising space to say a free user who lives in India, South America, Africa, Romania, Ukraine, and other economies with more of a wealth gap and poverty problem.

This is simply because these countries do not contain citizens who have the same amount of money to spend as say… America, the United Kingdom, Australia, France, Spain, and other more economically developed countries.

Therefore, advertisers will pay less per click for adverts in varying regions of the world. Additionally, due to the varying economic circumstances, these same countries do not pay the same price as a 1st world country does for a subscription – it would not be fair, and streaming services would not be adopted at the same rate in these zones if they did.

This makes the pool of revenue much smaller for streams that you get from developing countries, and therefore there is less to share out. This is often the reason you will see altering average pay-out per stream figures for Spotify and other streaming platforms because it is an average pay-out based on all stream earnings.

Additionally, the amount a stream earns changes depending on the status of the user. A free user will generate less revenue than a paid listener, therefore lowering the average payout per stream.

To top it all off, you will additionally earn more money on streams that spend a long time listening to your music than ones that do not spend the same time listening. If free users stay on the platform longer, they are subject to more ads, more ad time = more money for streaming service, and more money in the pool to share.

How Much Does Each Streaming Service Pay Per Stream?

Different music streaming platforms will pay out different amounts on average per stream. This is based on the number of users, paying subscribers, and advertising deals these services have.

Please remember that the data is only an average, taken from all the streams accrued on each platform. You will not make a straight $0.005/stream or straight $0.002/stream. It will be more diverse than that, and you may end up making a higher average because of the location of your audience, or even the deal your distributor or label has with DSPs.

Here's the complete list of pay-out per stream averages for all music streaming services:

Streaming ServicePayout Per Stream in 2022 ($)
Napster0.01682
Tidal0.01284
Amazon Unlimited0.01175
Apple Music0.01
Deezer0.0064
Amazon Digital Services0.00402
Spotify0.0037
Pandora 0.00133
YouTube0.00069
Others (Yandex, Peloton, iHeartRadio etc)0.012663

Spotify Pay

Spotify is the biggest streaming service out of all of them, with a total market share of 48.3% and a user base of 180+ million people. Therefore, you'd assume they pay the most per stream… right?

Spotify pays, on average, $0.003 per stream, which is ranked the 6th highest pay-per stream value. In fact, Spotify generates some of the highest revenues, yet pays the least on average per stream.

That means on average for 1000 streams you'd only earn anywhere between $2 and $4.

Compared to Apple Music, which only owns 24.9% of the market share, Spotify pays a lot less. However, it's reported that it is unlikely Apple Music is making a profit, and use the service as more of a reason to buy into the Apple ecosystem.

Does this mean that you'd earn more if you put your music on Apple Music, Napster, or Tidal?

Not necessarily.

Due to the lack of users these platforms have, they generate a lower amount of streams. Although these streams might be more fairly distributed, you're likely to earn the most from Spotify, and have the most opportunity, just because of the sheer volume of users and market share that Spotify has.

Apple Music Pay Per Stream

Apple Music is the 2nd biggest streaming platform with 24.9% of the market share and over 88 million subscribers.

As of 2021, Apple Music pays $0.01/stream, which is the 4th highest pay-per-stream value out of all the music streaming platforms. They additionally revealed that they pay rightsholders (distributors, labels etc.) each the same rate.

There are no particular deals with different distributors or different labels – they believe every artist should be paid an equal value per stream.

This is, of course, run on the same model as Spotify though, where the money comes from paid subscribers, and advertisers, and then the revenue is split from the money that is made from those deals. However, they pay $0.01/stream to all artists regardless.

Apple Music is said to make a loss or a smaller profit and uses Apple Music as a reason to buy into the Apple ecosystem, rather than a money-making part of their goods and services – it makes people more likely to buy an iPhone or a Macintosh.

Tidal Music Pay Per Stream

Tidal pays one of the highest rates per stream and was set up as an answer to artists feeling underpaid for their streams on platforms like Spotify. Additionally, it set out to be the highest quality audio streaming service available.

On average, Tidal pays $0.013 per stream, which is ranked as the 2nd highest payout per stream.

However, many artists have reported issues with Tidal not paying them correctly, and it seems that this figure might have been a subject of creative accounting, rather than legitimate data.

For instance, it has been alleged that Tidal may have been underpaying artists by 35%. If that is true, then the high pay-out per stream figure could actually be a lot less.

Additionally, as mentioned above, the amount of users on the platform directly affects how much revenue you will earn from said platform. Due to the lower subscription base, there is less opportunity to get a huge number of plays and therefore you're likely to earn less using Tidal.

Amazon Music Pay Per Stream

Amazon Music reportedly comes in at the 3rd highest payout per stream music streaming platform. They pay $0.012/stream on average to the rightsholders of music. This is then paid to artists based on the contract they have with the rightsholders of that music.

If, for instance, the artist is on a 50/50 deal with a label, the label will take 50% of the revenue and the artist will take 50% based on that deal.

With one of the highest payouts per stream, Amazon Music earns musicians a fair chunk of money. However, with the low subscriber base, it's impossible to earn as much as on Apple Music or Spotify.

YouTube Music Pay Per Stream

YouTube Music is ranked one of the lowest pay-outs per stream in music streaming, with an average payout of $0.0007 per stream.

Many people listen to music on YouTube, however, there are few people who have chosen to take out a YouTube music subscription. Therefore, with a small user base and a small pay-out per stream, it takes a whopping 20+ million streams each year to earn minimum wage using YouTube music as your main source of revenue.

Napster Pay Per Stream

Napster pays the most per stream out of all the companies. Interestingly, Napster started out as an illegal P2P sharing service, which became the reason for the birth of Pandora and the likes that followed.

They pay an average of $0.017 per stream, making artists on Napster the most well-paid out of all the streaming services.

To earn a minimum wage on Napster, you would need a grand total of 1+ million streams each year. However, with a low subscriber count, it is much harder to garner these streams on Napster, due to the lack of people using the service.

Deezer Pay Per Stream

Deezer pays an average of $0.006 per stream. They are above Spotify in terms of average payout per stream, which is strange considering their user base is much smaller. This could be due to a lack of data pulling the average down.

When compared to other services, Deezer has one of the lowest subscriber counts with just under 20 million users on the platform.

Pandora Pay Per Stream

The company that started it all, Pandora began as a music radio service that has since evolved into a similar platform to Spotify. Pandora pays $0.001 per stream, which ranks as the 7th highest paying platform.

Although they were the first to create a music streaming service, Pandora was quickly outranked by the likes of Spotify, Apple Music, and others in terms of market share and user base.

This has prevented Pandora from expanding too much and is one of the reasons their stream payout is among the lowest.

Others (IHeartRadio, Yandex, Pelloton etc.)

We have chosen to put these together because there is a lack of data due to a far smaller user base than other streaming services. Therefore we've pooled together the average pay-out per stream you can expect to get from these services if you're lucky enough to garner the streams from them.

This ends up being one of the highest-paying figures you'll see on this list, but we urge you to take it with a pinch of salt, because these platforms' figures may be skewed due to a lack of diverse data.

The average payout per stream for these platforms is $0.013 per stream.

The Importance of Using The Music Royalty Calculator For Rough Calculations

Using a calculator is useful, even if it's only an average because you can use these calculations as goals and help you plan how you are going to reach those goals.

For instance, by using a calculator, you can find out how many streams you need to earn a living from streams alone and create an in-depth marketing/goal tracking sheet on what you are going to do to reach those goals.

Rather than being in the dark, you have a numerical value to reach for, which is essential in goal setting. You can begin to visualize how you can get there, and use rough mathematics to help you plan your goals.

For instance, it could help you figure out how many Spotify playlists you'd need to get into to reach your monthly listener goal to be independent of your music.

What Are Streaming Royalties?

Streaming royalties are the money artists get paid by music streaming companies for the number of listeners that rack up on a song, album, or EP. These royalties typically come from advertising revenue and paid user subscriptions. The streaming service takes a cut from these royalties and then pays the artist the remainder

Streaming royalties are part of what we call mechanical royalties, which are royalties generated when a piece of music is listened to, reproduced or downloaded. This could be physical – much like a CD – or digital – like a download, or a stream.

Other royalties consist of:

  • Performance – when a song is played on radio, bar, shop etc.
  • Synch – when a song is used in film, TV, games and media.
  • Print – when a piece of music is sold as sheet music

Summary

Since the dawn of the Millenium, the music industry has been ever-changing, with illegal downloads running rampant at the first stages of the internet. This left a lot of musicians losing out on money due to P2P sharing services like Napster, Limewire, and more.

From 2000 – 2005, the music industry was largely earning its money from live shows, merch, and physical items that couldn't be downloaded. That all changed when Pandora was introduced – an affordable, monthly subscription to a huge library of music and a way for artists to earn money.

This influenced other competitors like Spotify, Deezer, and other music streaming services to be born.

Growing from a total subscription base of 0 to now 523.9 million, music streaming has forever changed the music industry, and given artists a better chance to earn, with a 50% of global recorded music revenue being generated from streaming.

Streaming royalties are now how you can earn a large bulk of your money as a musician, and they've paved the way for artists to become independent and not have to so heavily rely on the influence of record labels.

If you're racking up 6 figure numbers on your profile, you're likely earning a decent chunk of your revenue from these streams alone.

If you're not getting many streams it's worth checking what you could potentially be earning using the music streaming royalty calculator above and creating a goal around it.

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