Lizzie Plaugic on The Verge gets the story:
I PAID $2.24 FOR A YEAR OF BUILT TO SPILL
Earlier this year when The Verge obtained a copy of Sony’s Spotify contract, we noted that Spotify uses a complex formula to determine the royalties artists earn from streams. Major labels likely receive a sizable sum from Spotify, but not all of that money is going to artists. And not all artists get the same cut of Spotify revenue either: depending on their contracts with the label, some musicians might only recoup 15 to 20 percent of the streaming revenue they brought in. Other factors also come into play, like the country in which a song was streamed and the currency value in that country. Still, Spotify admits the average “per stream” payout to rights holders lands somewhere between $0.006 and $0.0084.Here’s what that means for me. My top artist of the year was Built to Spill, whose songs (mostly from There’s Nothing Wrong with Love) I streamed 267 times over the course of 2015. Using the upper limit of Spotify’s estimated payout, that would be 267 x .0084, which means I paid Built to Spill somewhere around $2.24 for an entire year of music. And that $2.24 is distributed among the music’s “rights holders,” which includes labels and publishers. So the band is getting even less than that. My most-streamed track of the year was The-Dream’s “That’s My Shit,” and I’m sure Terius Nash appreciated the 27 pennies that earned him. I listened to 13,000 minutes of music on Spotify this year, which means I paid around one-tenth of a cent per minute. And I’m paying Spotify’s $10 per month subscription fee; if I were relying on its free, ad-supported tier, the payout for artists would be even smaller.