How Much Do Music Streaming Services Pay?

May 31, 2024

Before releasing any music I always wondered how much people were paid when their music was streamed. It is a remarkably difficult thing to pin down. I researched the question beforehand, came up with my own estimates, and ended up being about 50% wrong when I released my first album to streaming services (a FFXI remake/cover album of music I covered for the HorizonXI private server.)

I wasn’t doing the project to make a profit but I was annoyed at how difficult it is to calculate your earnings in advance of releasing a project. Most of the articles made it seem hard to calculate or impossible to estimate. This is wrong. It is easy to estimate, it is easy to explain the factors and context that influence those estimates, and that’s what I’m going to do here.

Pre-Knowledge #

So when I’m talking about money made from streaming I am exclusively talking about recording royalties.

For clarity, there are two types of royalties: song writing royalties and recording royalties. No streaming service will pay you song writing royalties directly - you get these from signing up with a union or representative who represents your rights and extracts your royalties from the services (this goes beyond just streaming) that use your music. If you’re covering someone else’s music, forget about ever seeing money from song writing royalties.

Streaming services will only pay you your recording royalties, usually via your distributor (eg. LANDR, DistroKid, etc…) This is all I will be discussing here. If you are using samples from music you do not own the recording rights do, the original sample owners will find your music and get that money back unless you have the right licenses for the sample you use.

If you’re using VST libraries you’ve purchased (eg. from Spitfire, Native Instruments, etc…) you’re good, because you buy a license to use their samples for music distribution without credit. If you’re chopping up someone else sounds, wave goodbye to your recording licenses.

Factors That Affect Earnings per Stream #

There are four main factors that affect the earnings you get per stream:

1. Stream Location
2. Type of Stream
3. Streaming Platform

Stream Location #

The biggest variable for most streaming services is the listeners location. The main reason for this is that platforms charge users different amounts depending on where they come from. They also make different amounts of money from adverts depending on where users come from. This model plays out in the data; countries that have citizens with large personal spending power (e.g. Switzerland) produce more money per streaming event than those with citizens that have lower spending power (eg. Colombia). Data below:

Data from February 2024, the first month of streams from Memories of Aht Urhgan

Type of Listen #

Not all streaming events are created equal. When you get your first earning report back you will see multiple entries for the same song covering the same time period. This is because steaming services will charge you different amount of money depending on the kind of stream that happens. There are a few ways they striate this (which will not be made clear in the report.)

1. Whether the stream was by a paying member.
2. Whether they streamed the whole song or only a part of it.
3. Whether the song they streamed was very long.

See this data for my US streams for one track in February 2024:

Data from February 2024, the first month of streams from Memories of Aht Urhgan

It has 8 different values for a US-based streaming event on the same song over the same time period. I can only theorise that these are for reasons to do with some listeners being paid members, resulting in a higher earning per stream ($0.0078) versus the most common stream payout ($0.0051). The stream payouts lower than this I assume are for partial listens. However, this could just as easily be Spotify providing less earning because someone listened to my song on a certain kind of playlist or via a certain listening method (eg. Embedded Player.)

Who knows! But the type of listen certainly has a role to play in how much you earn. Unless you have some very odd listener patterns though I think the impact this has is negligible.

Streaming Service #

There are lots of these but let’s focus on the biggest two in my data: Spotify and Apple Music. My summary is that they’re different! Apple pays more. Whoop-de-do. Here’s the data for my streams just from the USA. I don’t have large enough ample sizes from other platforms to include their data.

Closing Remarks #

All this to say, there is a lot of variance in how much you will make per stream. Depending on what part of the world your music is popular and what platforms they use to stream you could be earning 56-67x more than another song per stream. The only lesson here is if you want to maximise earning per stream then make music that appeals to the inhabitants of Switzerland that use Apple Music.

Comments #