top of page

Spotify Pays £750m to UK Music Industry in Royalties

Spotify paid £750 million in royalties to the UK music industry last year. Almost 1,000 artists earned at least £100,000 in royalties on the platform. Individual artists' share of royalty payments is determined by their contracts with record labels and publishers.

The company disclosed this information as part of its "Loud and Clear" campaign, which aims to provide transparency on how it compensates the music industry. According to Spotify, almost 1,000 artists received at least £100,000 in royalties, indicating their significant presence on the platform.


However, Spotify cannot determine the exact amount of royalty payments that reach individual musicians. This is because each artist has a unique contract with their record label and publishers, which determines the distribution of funds. It has been reported that artists typically receive around 16% of the generated revenue. Therefore, an artist whose music earned £100,000 on Spotify might only receive £16,000 in royalty payments before taxes.


It is important to note that Spotify is not the sole source of revenue for artists. With approximately 50% market share in the UK music streaming industry, artists have the potential to earn a similar amount through other platforms such as Apple Music, Amazon Music, and Tidal.


In terms of popularity, Ed Sheeran emerged as the most played British artist on Spotify last year, with his songs amassing 6.35 billion streams. Coldplay and Harry Styles followed closely behind with 5.58 billion and 5.11 billion streams, respectively. However, British artists were unable to break into Spotify's Top 10 most-played chart, which was dominated by international stars like Taylor Swift, Bad Bunny, Peso Pluma, and Karol G.


Interestingly, the dominance of English-language songs in global music is declining. More than half of the artists who earned $10,000 on Spotify last year come from non-English speaking countries. While English still accounts for 54.9% of the top 10,000 songs globally, languages like Hindi and Japanese are gaining traction.


Bryan Johnson, Spotify UK's head of artists and industry partnerships, expressed excitement about the evolving music landscape. He highlighted the rise of genres like K-pop, Amapiano, and Music Mexicana, and emphasised the vast choices available to fans and listeners.


Furthermore, Johnson revealed that 75% of the royalties paid to UK artists came from international listeners, indicating a significant export opportunity as the streaming market matures. Independent artists and labels also received a substantial share, with 40% of the UK's royalty payments amounting to £300 million.


However, Spotify has faced criticism for its policy of demonetising songs with fewer than 1,000 streams. This means that copyright holders will not receive any payment if their songs fall below this threshold within a 12-month period. Critics argue that this policy benefits established artists while depriving working musicians of income. Spotify defends the policy as a means to filter out spam and prevent fraudulent activity.


Despite the controversy, Spotify remains a major contributor to the music industry's revenues. In 2020, the company paid $9 billion in royalties worldwide, solidifying its position as the largest single contributor. YouTube is considered the industry's second-largest source of income, having paid out $6 billion to rights-holders in the same year.

 
  • Spotify paid £750 million in royalties to the UK music industry last year.

  • Almost 1,000 artists earned at least £100,000 in royalties on the platform.

  • Individual artists' share of royalty payments is determined by their contracts with record labels and publishers.


Source: BBC

bottom of page