Today we are answering the question that EVERYONE has been asking..."How much does Spotify actually pay artists?"I sat down with Sam Duboff, the Global Head of Spotify for Artists to answer that exact question.Prior to this interview, I did a lot of research on the business of streaming as a whole, and how the music industry collects revenue. My goal with this video is not to push anyone's opinion one way or another, but to add some clarity for exactly how this monetization structure works for Artists, DSPs, Songwriters, Producers, Labels/Publishers, and anyone else involved when it comes to music streaming.JOIN THE DISCORD:https://discord.gg/FjSrEF2JZ4 Follow the Pod on SPOTIFY:https://open.spotify.com/show/0WWqkpzdSCY7Sj6XlTROY1Follow the Pod on APPLE:https://podcasts.apple.com/us/podcast/nicky-at-night/id1758627077Follow me on IG:https://www.instagram.com/nicky.reardon/#musicindustry #musicmarketing #aspiringartistToday we are answering the question that EVERYONE has been asking..."How much does Spotify actually pay artists?"I sat down with Sam Duboff, the Global Head of Spotify for Artists to answer that exact question.Prior to this interview, I did a lot of research on the business of streaming as a whole, and how the music industry collects revenue. My goal with this video is not to push anyone's opinion one way or another, but to add some clarity for exactly how this monetization structure works for Artists, DSPs, Songwriters, Producers, Labels/Publishers, and anyone else involved when it comes to music streaming.JOIN THE DISCORD:Follow me on IG:#musicindustry #musicmarketing #aspiringartist
Chapter 1: How did piracy affect the music industry before streaming?
10 years ago, the music industry was on the brink of financial collapse. From 1999 all the way to 2014, music was in a 15-year downward spiral, hemorrhaging money, each year losing more money than the last. And all of this was for one major reason. piracy.
With the invention of technology like Napster, LimeWire, MP3 players, jailbreaking your iPhone even, people were illegally downloading music left and right, giving nothing to the artists at all. And because all of that, music saw nearly a 70% drop, $9 billion in less than 10 years. However, all of that changed with the invention of one technology. Music streaming.
The idea was that if we just charge people a subscription, and for that one monthly fee, they get access to all of the music in the world, so much music, that it would actually just be kind of inconvenient for them to pirate every song one at a time. And to these people who are used to paying $20 for one CD, $12 for all the music in the world, didn't sound like that bad of a deal.
Enter Spotify and the genesis of the streaming era, where every year since then, the music industry has grown. So much so that in 2024, the industry has been worth an estimated $29 billion, surpassing its previous peak in 1999.
And even the largest labels in the world, like Universal Music, put in their 2024 financial report that 77% of all recorded music revenue came from subscription-based streaming. And Spotify, as the largest platform in the world,
paid out over 10 billion dollars to the music industry in 2024 alone despite all of this being true however there is a lot of discourse from artists saying that spotify doesn't pay artists enough so how does this make sense how can an artist be struggling when the music industry is more profitable than ever how can labels be reporting that nearly 80 of the revenue they collect comes from streaming yet artists are saying nearly none of the revenue they collect comes from streaming what is actually happening here how are artists getting paid
And how can we look at this to decide the best path forward for an industry as a whole? Well, that is exactly the question we've set out to solve here today. I am sitting down with Sam Duboff. He's the global head of Spotify for Artists, Marketing, and Policy, and here to answer some questions about exactly all of these topics here today. Sam, I'm so excited to have you on. Thanks for being here.
Excited to get into it. It's going to be good. I have many things to say, and I'm honestly very interested to hear your opinions on this topic. And I also would like to really commend, like, I really appreciate the transparency. I know that this is a very sensitive topic, and it has been very easy for many people in the past. from all sides of the industry to just not talk about it at all.
And I would really like to commend you for being willing to sit with me and have an open dialogue about this. And I think that speaks a lot to both your character and the character of the company.
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Chapter 2: What role did Spotify play in the revival of the music industry?
The idea is, like, we are investing in you. You have this money so that you can quit your job, so that you can fund your music, so that you can spend your 40 hours a week either writing, practicing, making social content, promoting it. Like, however you do it is up to you. But the point of the money is to give you this ability to pursue this thing full time.
Yeah.
Um, in exchange for this industry standard for my reading was an 80, 20 split. I know that the real way it works is that everybody has like their own contract with their own label. Some people could be more, some people could be less. I think generally for like indie labels, it'll be like the, they get, cause they know they're smaller, they get a little less percentage, blah, blah, blah.
Um, I don't know. It depends on the label.
Yeah, yeah. Generally, major labels take a bigger cut and you label somewhere in between. And then if you're self-releasing your music, it's all you.
Yeah. So in exchange for this 80-20 split to the label, we're using that as an example. They give you the advance. They promote it. They do the marketing. They are helping with social strategy. They might give you PR. They might fund a music video. They are having connections to do things like touring, maybe they can get you on an opener for somebody else.
They can be equipping you with songwriters, producers, dancers, or just other things that develop you as an artist. The idea is that you are giving this percentage of your
rights you're streaming to um have the incubator to be in this thing where you can develop as an artist and and where you are going to have every tool in the tool about all that support yeah and and and in many ways you can't do also there's like weird logistical stuff you know what i mean like like your favorite like your favorite artist isn't like sending a 1099 for streaming royalties for the songwriter that you use on one song like like the label is doing that for them right like there's like an actual genuine service being done through this system absolutely
However, in this video by Jelly Roll, which I found so fascinating, is when he talks about this idea of an 80-20 split, right? Let's say they give you $500,000 advance and you go and release an album that generates $500,000. You might be like, heck yeah. Break even on my first album, period. Yeah. And the answer is no. The way it works is the label would get 400K. The artist would get 100K.
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