It’s always been known that many music streaming services pay out a lot more in song royalties than Spotify. Even though the numbers that are reported are vague averages (more on that in a bit), it’s still illuminating that Apple Music is paying out almost twice as much as Spotify. You can see for yourself with Manatt’s streaming royalty calculator.
As you can see from the graphic above, Apple Music pays the artist $7,085 for a million streams while Spotify pays $3,700. There’s also publishing royalties paid out as well and Apple Music pays more here as well, with $899 for mechanical royalties and $819 for performance. Spotify pays $591 for mechanical and $506 for performance. Apple keeps about 28% of the total revenue from the song while Spotify keeps 47%, according to the Manatt’s graphic (this seems high to me).
The 1,000 Stream Threshold
You’ve probably heard about Spotify’s new 1,000 stream threshold that goes into effect in 2024 where a song will not accrue royalties unless it reaches 1,000 streams during the year. According to Manatt’s calculator, a thousand streams only adds up to $4.80 in song royalties totaling both the sound recording and publishing.
There seems to be a lot of furor over this but it’s really much ado about nothing. If your song can’t get a thousand plays during the year, does it really doesn’t deserve to earn royalties? Not only that, you’re only losing enough to buy yourself a Starbucks coffee anyway.
Not All Streams Are Equal
Keep in mind that anytime you see royalty calculations they’re just an average, and no two royalty statements are ever alike even if they have the same amount of streams. The reason is that it depends on where the streams came from.
The ad supported tier pays less than the paid tier, so if most of your streams come from ad supported then you’ll be paid less. Likewise, where in the world you streams come from makes a difference as well. If most of your streams come from a country like India or Indonesia where the user pays far less per month than a U.S. customer, then that will mean a lower royalty rate as well even with the same number of streams.
The bottom line is that some streaming services pay more than Spotify, and in this case, Apple Music pays almost twice as much.