Free users of Spotify rising faster than paid subscribers—with impact on artists and rights holders

Posted on: October 25, 2021

“Spotify free users are growing at a faster pace than paid users, according to just-published research finding,” writes Ashley King in Sunday’s (10/24) Digital Music News. “A report from eMarkerter suggests that Spotify will hit 41.5 million free users in the US this year. That’s an increase of 9.7% over 2020, and part of a trend that finds ad-supported listeners making up an increased share of Spotify’s platform…. Spotify is expected to surpass 83.1 million monthly users, making it the most popular audio streaming service in the United States…. Spotify is currently building up ad-targeting tools for podcasts that serve up more revenue than music listeners…. That reliance on ad-supported listeners doesn’t help artists get paid…. Premium subscribers contribute far more, with ad-supported seriously lagging behind. Streamed music makes up 83% of recorded music revenues in the United States—of which Spotify paid $5 billion to music rights holders in 2020. On a blended scale, industry estimates suggest Spotify pays about $4,000 for a million streams. That’s less than a half of a cent ($0.005) per stream. That means artists need to earn millions of streams to make anything substantial from their music.”