How many streams does it take for an artist to earn one dollar? Well, it depends.
Whenever I have one of my speaking events, the conversation inevitably turns to the economic hardships artists are facing these days. With less and less money coming from the sales of music, there’s more and more attention placed on revenues coming from streaming. And for the vast majority of musicians, those revenues are pitifully small.
Before you scroll down to the chart, remember that the streaming services have to negotiate with labels, publishers, and rights holders for the privilege of playing music as part of their business. It’s not that they’re being all Mr. Burns about what they pay; this is what they’re told to pay by the organizations that represent artists. New licensing fees are negotiated every couple of years.
Also remember that the current economics of how streaming companies operate pretty much guarantee that they will never be profitable. The way things are structured, the more revenue that comes in, a commensurate about of expenses are incurred. There’s no way for efficiencies and synergies to lead to higher margins.
Now that chart. According to Visual Capitalist, these are how many an artist needs to have before they earn one dollar.
Read more here.
The term “artist payout” in this chart is a bit misleading. It should be “royalty payout”. What often gets lost in this conversation is that there is a big difference between what a streaming service pays out in royalties for the streams of an artist’s songs, and what amount actually makes its way into the artist’s bank account. Unless you’re a fully independent artist (ie own the master rights and the publishing rights to your songs), then the label and (to a lesser extent) the publisher get a significant share based on the terms of the artist’s contract. So for every dollar the ISP pays out in royalties, the artist may only actually get 20-50 cents, and that’s after the label’s recoupables.