These days, most people listen to music through streaming apps like Spotify, Apple Music, or YouTube Music. Some people pay for subscriptions, while others use the free versions with ads and limited features. If you’re paying, you might assume your money goes to the artists you listen to. But that’s not really how it works.
Spotify often says they pay about 70% of their revenue to music rights holders. But how they split that money is not based on what you listen to. Instead of dividing your monthly fee based on your personal streams, they put all the money in one big pool and pay artists based on their share of total plays across the entire platform.
Let’s say there are only two users on Spotify:
- User A listens to 50 Parcels songs
- User B listens to 200 Taylor Swift songs
- Spotify keeps 30% of the money ($3 out of each $10 subscription)
Here’s what people might think happens:
- Each artist gets paid based on what their listeners listened to
- Parcels gets $7 from User A
- Taylor Swift gets $7 from User B
- Spotify keeps $6
But here’s what actually happens:
- Taylor Swift got 80% of the total streams
- Parcels got 20%
- Spotify puts the leftover $14 (after keeping $6) in a pool
- Taylor Swift gets $11.20
- Parcels gets $2.80
So even if you only listen to indie artists, your money still mostly goes to the big names, because the payout is based on total listening across all users, not just you.
In 2024, here were the top artists by streams:
| Rank | Artist | Streams (Billions) |
|---|---|---|
| 1 | Taylor Swift | 28.21 |
| 2 | The Weeknd | 13.27 |
| 3 | Drake | 12.11 |
| 4 | Bad Bunny | 12.08 |
| 5 | Billie Eilish | 12.00 |
| 6 | Ariana Grande | 10.03 |
| 7 | Kanye West | 9.67 |
| 8 | Peso Pluma | 9.38 |
| 9 | Travis Scott | 8.41 |
| 10 | Bruno Mars | 8.36 |
Spotify had about 4.8 trillion streams in 2024. They say they paid out $10 billion to artists. Since Taylor Swift had about 0.6% of the streams, she got about $60 million from that alone. The Weeknd got around half of that, and so on.
Now let’s talk about a smaller band. Say an indie group has 10,000 fans who each listen to their songs 10 times a day. That’s 36 million streams a year. Sounds like a lot, but it’s just 0.00076% of all streams on Spotify. That would earn them around $76,000 for the whole year, not per month, as many people might expect.
This is why many smaller artists say streaming doesn’t pay the bills. If Spotify changed the model to pay based on each user’s listening habits, big artists would still make a lot, but smaller artists would make much more than they do now. Apple Music does the same kind of global payout, by the way. So Taylor Swift likely earns way more than $600 million a year from all platforms combined.
What are the alternatives? Not many. You could try buying songs on Apple Music, but those versions often don’t come with lyrics or high-end features like Dolby Atmos. So you get less for the same price.
One option that still helps artists is going old school: buy vinyl records. You get better sound, cool artwork, and your money goes more directly to the musicians you want to support.
EDIT: A friend of mine recommended Bandcamp.com after reading my post. It looks like a great alternative to other platforms, offering high-quality album downloads while directly supporting the artists. I’m definitely going to try it out.
