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Spotify's New Royalty Scheme Declares Unpopular Songs Won’t Earn Royalties Anymore

A few weeks ago, Music Business Worldwide broke the news that Spotify is revamping its revenue model, which includes demonetizing the lowest-played tracks on the platform. Spotify largely confirmed those plans in a blog post published today.

via: Uproxx

The streaming service will adjust the goalpost for the number of streams needed to start earning royalties.

Starting in early 2024, a song would need to reach at least 1,000 streams within the past 12 months before it can start to earn money. For comparison, the current royalty system finds Spotify paying $.03 a month to any song that earns between 1 and 1,000 plays.

As the company pointed out in a statement, this money reportedly doesn’t even typically reach the artist between the fact that “labels and distributors require a minimum amount to withdraw” and “banks charge a fee for the transaction.” In total, these small royalty payments add up to about $40 million per year.

However, Spotify brings up that “99.5% of all streams are of tracks that have at least 1,000 annual streams, and each of those tracks will earn more under this policy.” The post also notes, “We also believe the policy will eliminate one strategy used to attempt to game the system or hide artificial streaming, as uploaders will no longer be able to generate pennies from an extremely high volume of tracks.”

Spotify is also adding other changes, like devaluing noise tracks: Tracks with just “whale sounds” or “static” will need to be at least two minutes to be eligible for royalties.

More information on the changes can be found here.

Spotify is a joke. Glad I don't use them as my go-to source for music.

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