Streaming Service Apple Music Claims Artists Receive a Penny per Play, Believing This to Be a Satisfactory Amount
Let's dive into the nitty-gritty of the streaming war between Apple Music and Spotify, focusin' on those all-important royalty payouts.
The Wall Street Journal spilled the beans, thanks to a disclosure letter sent out by Apple Music to creators via their artist dashboards and shared by 9to5Mac. Turns out, Apple Music doles out an average of a penny per stream to artists, significantly surpassing Spotify's meager payouts of a third to half a penny per stream. That's right, Apple Music consistently doubles or even triples what its rival fork over to artists.
Now, hold on tight, 'cause things get a bit murky. Artists don't bask in these juicy payouts directly from the streaming services. Instead, they receive their dough from rights holders they've got contractual agreements with for distribution. So, 50 plays of an artist's track might not equate to a whopping 50 cents in the artist's bank.
Neither platform has responded to requests for comment on the details of their payment terms for creators, including any stipulations regarding how much of a song must be played before it's eligible for payment.
Apple Music's disclosure paints Spotify in an awkward light. Spotify boasts a gigantic platform with 345 million users, 155 million of whom fork over their hard-earned cash for premium. Apple Music is a piker in comparison, with only around 72 million subscribers by June 2020, according to Statista. Except during free trial periods, Apple Music is a pure-play subscription service set at a tenner a month. Spotify's premium tier, on the other hand, also costs $10 a month, but offers up ad-free listening.
Spotify unveiled its Loud & Clear transparency initiative last month to tackle queries about its streaming economics. In a question-and-answer section of its site, the company addresses concerns about its per-stream rates being lower than those of some other services. Spotify's reasons—a global audience, high streams per listener, and an ad-supported tier—boil down to the company's belief that its model maximizes revenue for all parties.
So, where does Apple stand in all this? In its letter, Apple confessed that stream value "varies by subscription plan and country," but averaged around a penny per play for Apple Music individual plans last year. The company kept it classy, emphasizing their commitment to artists and finding innovative ways for them to make a living from music.
"With Apple Music, music fans revel in an ad-free, privacy-protected experience," the letter read.
[1] - Independent Reporting, 2021[2] - Spotify Transparency Report, 2021[3] - Wall Street Journal, 2021[4] - Billboard, 2021
- In the technology-driven future, the average cents earned by artists per stream on Apple Music stands at approximately double or triple that of Spotify.
- Despite Spotify's massive user base of 345 million, including 155 million premium subscribers, the tech company's contractual agreements with rights holders may affect how much artists eventually receive in royalties.
- Even though Spotify has launched its Loud & Clear transparency initiative to address concerns over lower per-stream rates, the exact contractual details regarding payment terms remain undisclosed by both streaming giants, including Apple Music.
- Interestingly, both Spotify and Apple Music decline to reveal the specific contractual stipulations regarding how much of a song must be played before it becomes eligible for payment, adding another layer of intrigue to the tech-infused future of the music industry.
