(Photo Credit: Spotify)
Artist numbers, rights holders’ payouts, and royalties — depending on your perspective, Spotify’s latest data dump could paint a promising picture for the future of streaming. The company’s self-reported royalty data for 2022 reveals who’s making money on Spotify (and who’s not).
So who’s actually squeaking out a living on Spotify? Out of 9 million artist profiles, Spotify says only an estimated 200,000 are ‘properly leveraging streaming as part of their career.’ These ‘professional or professionally aspiring artists’ have released at least 10 tracks, average a minimum of 10,000 monthly listeners, and conducted a commercial activity outside of streaming during 2022.
Spotify data reveals that just over a quarter (29%) of these 200,000 — roughly 60,000 serious artists — generated $10,000 or more in Spotify revenue in 2022. That’s either good or bad, depending on the perspective and subsequent number-crunching.
For Spotify, the analysis starts with an important working assumption. The streaming giant says it accounted for over 20% of global recorded music revenue in 2022— up from less than 15% in 2017. Also according to Spotify, the platform’s all-time payouts to music rights holders is approaching $40 Billion in recording and publishing royalties.
Spotify believes that during the last two decades, streaming has transformed the dynamic music ecosystem. With low barriers to entry, it has drawn passionate new musicians and creators from all over the world. Spotify’s report on its own royalty data also reveals that in 2022, only 12% of Spotify’s US streams were credited to the top 50 artists. Stats like these place the spotlight on how music industry revenue is reaching more than just mega artists and creators.
Spotify data also reveals that in 2022, a quarter of artists who generated over $10K from Spotify were self-distributed, and 35% reside in countries outside the top-ten music markets.
The number of artists generating over $100,000 per year grew 135% from 2017 to 2022. Moreover, artists reaching milestone annual-revenue levels of $10K, $100K, and 1 million, have more than doubled during the last five years.
With an ever-growing number of listeners, Spotify reports that in total, 913,000 songs have crossed the million-stream mark. In 2022 alone, 281,000 songs reached this milestone, with almost 350 songs already crossing the billion-stream mark by the end of last year.
Music catalogs also appear to have become ‘more valuable than ever.’ Spotify says catalogs ‘can still generate healthy revenues year after year.’
The company spotlights catalog musicians as ‘heritage artists,’ defined as an artist that averages more than 500,000 monthly listeners, with 80% of streams from tracks that are more than 5 years old. This exclusive group comprises 3400 artists that generated $433,000 from Spotify alone in 2022. Spotify estimates that these heritage artists made well over $1 million in revenue across all streaming services.
With this powerful revenue-generating capability, the streaming giant is calling catalogs ‘a signal of optimism for the future value of music.’
Spotify’s royalty data is painting a pretty picture for the future of streaming and the overall music landscape, and the streaming giant says, ‘It expects growth rates shown on this site to continue.’