Spotify Explains Why There’s No ‘Per-Stream Rate’ – Artists and Industry Push Back

Spotify has published a new explanation of how Spotify streaming payouts work aimed at debunking a persistent myth: there is no fixed per-stream rate. Instead, Spotify uses a streamshare model, where an artist’s payout depends on their share of total listening across the platform each month.

If a track accounts for 1% of all streams, it earns 1% of the royalty pool. Spotify argues this is the fairest and most sustainable system — but many artists and industry voices aren’t convinced.

What Spotify Says

Spotify stresses that it pays out nearly 70% of its revenue to rights-holders and that fluctuating “per-stream” averages are a function of math, not policy. Because Spotify has the largest user base and the highest volume of listening, its massive royalty pool is divided across billions of streams, making the effective per-stream amount appear smaller compared to more niche or regional services.

The company also reminds creators that contracts — not Spotify — determine individual artist payouts, since royalties flow through labels, publishers, or distributors.

Artist Reactions: “Still Not Enough Transparency”

While some may appreciate Spotify explaining the mechanics more clearly, many remain frustrated:

• Indie artists say streamshare continues to reward the biggest acts, leaving smaller creators fighting over fractions of a cent.
• Songwriters argue that even with record-high streaming numbers, their income hasn’t kept up.
• Producers and beatmakers complain that shared splits make an already tiny payout even smaller.
• Touring musicians say streaming exposure doesn’t reliably translate to sustainable income — making touring and merch even more critical.
• Artist advocates highlight a philosophical issue: “If streaming is now the dominant form of consumption, shouldn’t it also be a sustainable source of income?”

Industry Analysis: Clearer Messaging, Same Structural Problems

While Spotify’s explanation is accurate, it doesn’t address deeper concerns about the health of the streaming music ecosystem.

• Streamshare is inherently winner-take-most. A few superstar artists capture an oversized share of the royalty pool.
• Pricing hasn’t kept pace with consumption. Industry analysts argue Spotify should raise subscription rates more aggressively to grow the pool itself.
• Noise content, mood playlists, and scams dilute payouts. Every low-value stream further divides the royalty pool.
• Global expansion pushes rates down. Streams from emerging markets generate far less revenue than streams in the U.S. or U.K.

A lingering question remains. Is Spotify just explaining the system rather than improving it?

Until the overall revenue pie grows — or until streamshare is redesigned — artists fear that clarity won’t translate into better compensation.

Read the streamer’s The Truth About Spotify Streaming Payouts here.

Bruce Houghton is Founder & Editor of Hypebot, Senior Advisor at Bandsintown, a Berklee College Of Music professor and founder of Skyline Artists.

“Spotify Explains Why There’s No ‘Per-Stream Rate’ – Artists and Industry Push Back” first appeared on Hypebot.com.