Explaining how Spotify pays per streaming
Spotify’s payment system for streaming is complex and influenced by multiple factors, including listener location, user behavior, and the type of subscription. Understanding these factors is crucial for artists seeking to maximize their earnings from streaming on the platform.
How Spotify Pays for Streaming and Factors Affecting Royalty Rates
Spotify pays for streaming based on a variety of factors, including the listener’s location, user behavior, type of subscription, and distribution agreements with the artist. Here’s a breakdown of how these factors influence royalty rates:
Listener Location:
- Royalty rates can vary depending on the listener’s location due to specific licensing agreements in each country or region
- The payout per stream will depend on the monthly profits and total streams in a specific country
- Listeners from different countries pay different amounts per stream, with premium listeners paying more than free-tier listeners
- Listeners from different countries pay different amounts per stream, with premium listeners paying more than free-tier listeners. For example, listeners from the US pay $0.0035 per stream, while Italian listeners pay $0.0019
- Different countries have different rates for streaming payouts, and promoting music in countries with higher payouts can benefit artists.
User Behavior and Skip Rates:
- User behavior, such as skipping tracks, rewinding, or playing them on repeat, can negatively or positively impact royalty rates.
The likelihood of someone skipping a song within the first thirty seconds of the track, known as the skip rate, is a factor that influences streaming payments.
User Behavior:
- User behavior, such as skipping tracks, rewinding, or playing them on repeat, can negatively or positively impact royalty rates.
Type of Subscription:
- Premium listeners pay more per stream than free-tier listeners, and the pay-per-stream also changes based on the listener’s country.
Distribution Agreement with the Artist:
- The type of distribution agreement with the artist can also impact the royalty rates.
- Spotify uses a stream share model, where the results can vary depending on several factors, including the country and the distribution agreement with the artist.
Skip Rates and Their Impact
Skip rate refers to the likelihood of someone skipping a song within the first thirty seconds of the track on streaming services like Spotify. This user behavior can impact royalty rates, as mentioned earlier. However, it’s important to note that skip rates are just one of the many factors that can influence how much revenue is generated by streams.
How does Spotify calculate the skip rate?
Spotify calculates skip rates based on the likelihood of someone skipping a song within the first thirty seconds of the track. This metric is influenced by various factors, including the listener’s age, the device used for streaming (mobile or desktop), and the day of the week. For instance, teenagers, known for having a shorter attention span, tend to skip “well above 50%” of the time, while older listeners have skip rates of about 35%. Additionally, the mobile skip rate is approximately 51.1%, while on a desktop it’s around 40.1%, indicating that users listen to music in the background while doing other tasks. Moreover, people tend to skip more on weekends than during the week, suggesting that when they have more time, they pay more attention to the music and are more willing to keep skipping until they find something they like.
It’s important to note that the skip rate is considered by Spotify playlist editors when shopping for new music, but it’s just one of many factors and should not be blown out of proportion. The skip rate is also not visible to Spotify playlist editors, and the tool used to measure it is burdensome and not available to the general public.
In conclusion, Spotify calculates skip rates based on the likelihood of listeners skipping a song within the first thirty seconds, taking into account various demographic and behavioral factors.
The PPS of 133 countries in comparison (Pay Per Streaming)
Below you can find the complete list with all 133 evaluated countries. For each country, you can see the PPS and the extrapolation of how much you get per million streams. In addition, you can see how high the amount for one million streams was in our last evaluation and how this has changed in percentage terms since then. The table can be sorted in any order.
All figures in USD / Status May 2022 Not every country pays the same amount of money for streaming on Spotify. So for example, listeners in the US will pay $0.0039 per stream, while listeners in Mexico will only pay $0.0011.
Source from Ingove How much do I get per stream on Spotify (2022 Edition)
In the meantime, Spotify makes sure you won’t get any money if you experiment with song structures. You only get paid from Spotify if someone listens to your song for 30 seconds or more. If 35% of the people skip the first 30 seconds, you won’t get any income from those plays. Also, for users who are not logged in on their Spotify account, the embedded player (for instance on your artist’s website) only plays a 30-second long audio preview of each song. Not enough, right? Apart from money, it won’t count as a ‘stream’ in your data as well. Which won’t help with your algorithmic venture into fame. It will tell promoters, journalists, etc. that you suck, basically. Source from Tinyroom Music
