Spotify has ambitious goals: to double its current subscriber base and reach 1 billion paying music streamers. The company believes streaming services are essential in normalizing paid music consumption, benefiting both listeners and artists.
Read: Boom Supersonic XB-1 breaks the sound barrier, a major milestone for supersonic flight
In a blog post titled “Getting the world to value music,” Spotify announced it paid out $10 billion to the music industry in 2024, bringing its total contributions since 2006 to nearly $60 billion. This milestone comes after years of criticism regarding artist payouts. Spotify claims that over 10,000 artists now generate more than $100,000 annually from the platform, a significant increase from the estimated 10,000 artists earning at least $10,000 per year in 2014.
Spotify VP David Kaefer paints a picture of the pre-streaming era as an exclusive club, contrasting it with today’s accessibility. “Now, you can record something today and have it on Spotify tomorrow,” he writes. “Everyone’s invited.” This democratization of music distribution is a key part of Spotify’s narrative.
Financially, Spotify is on track for its first full year of profitability, having reported €4 billion (approximately $4.1 billion) in revenue for the three months prior to November, a 19% increase year-over-year. The company will announce its full 2024 earnings next week.
Despite the positive revenue figures, Spotify continues to face criticism regarding its per-stream payout rates, which are reportedly lower than competitors like Apple Music, YouTube Music, and Amazon Music. Artists and policymakers have also criticized Spotify’s royalty structure and recommendation algorithms, arguing that payouts are too low and that the focus on promoting established artists makes it difficult for emerging musicians to gain exposure.
Spotify’s global head of music communications, Chris Macowski, defends the platform’s payout model, attributing competitors’ higher per-stream rates to “low engagement” and claiming that Spotify prioritizes “higher overall payout.” The company has consistently released payout figures in recent years to address these criticisms. However, the debate continues, with incidents like the takedown of a parody “Spotify Unwrapped” website highlighting the tension between Spotify and some artists.