Spotify Claims Streaming Has Made The World 'Value Music'

Spotify has set an ambitious target: to see 1 billion people paying for music streaming, doubling the more than 500 million customers currently subscribed to Spotify and its competitors. The streaming giant believes that artists are fortunate to have streaming services, which have played a vital role in normalizing the act of paying for music.

In an announcement made on Tuesday, Spotify revealed that it paid out $10 billion to the music industry in 2024. Since its founding in 2006, the company has contributed nearly $60 billion to the sector—five years after the demise of Napster. Spotify also highlighted a significant growth in artist payouts: In 2014, approximately 10,000 artists were earning at least $10,000 annually on the platform. Fast forward to today, and Spotify estimates that well over 10,000 artists now earn more than $100,000 per year from the platform alone. As Spotify VP David Kaefer shared in a blog post, "That’s a beautiful thing."

The blog post, titled “Getting the World to Value Music,” reflected on the pre-streaming era, where the music industry was an exclusive club, making it challenging for new artists to break through. Kaefer emphasized the transformation streaming has brought: “Now, you can record something today and have it on Spotify tomorrow. Everyone’s invited.”

Spotify also shared its progress toward achieving its "first full year of profitability" in 2024, with a reported revenue of €4 billion (about $4.1 billion) for the preceding quarter—marking a 19 percent increase from the same period the year before. The company is set to report its full-year earnings next week.

Despite the positive momentum, Spotify continues to face criticism regarding its payout model. It has been reported that Spotify’s per-stream artist payout rates are lower than competitors like Apple Music, YouTube Music, and Amazon Music. Many artists and policymakers have criticized Spotify’s streaming royalties and recommendation algorithms, claiming that payouts are too small and that the platform’s focus on promoting big-name artists makes it difficult for emerging musicians to gain visibility.

Spotify’s global head of music communications, Chris Macowski, defended the platform’s strategy, attributing competitors' higher per-stream rates to "low engagement" on services where subscribers "listen to less music." He explained that Spotify optimizes for "higher overall payout."

In response to ongoing criticism, Spotify has regularly released payout figures in recent years. In December, a parody website called "Spotify Unwrapped," which compared subscription fees to artist payouts, was taken down by Spotify’s legal team.