Major music streaming platforms are eliminating songs with low play counts, impacting many artists who earn only a few dollars despite millions of streams. This change in strategy, exemplified by Spotify’s new policy of not paying royalties for songs with fewer than 1,000 streams in a year, reflects the growing challenge of maintaining vast catalogs amid increasing operating costs.
According to a 2023 report from Luminate, 82.7% of songs received fewer than 1,000 streams, and almost a quarter had no streams at all. As the music catalog continues to expand, it’s projected that the number of unstreamed songs will surpass 100 million by 2028.
The prevailing royalty payment model, known as “pro rata,” favors top-tier Jamaican artists like Sean Paul, Bob Marley and Shaggy but leaves many others with meager earnings despite amassing millions of streams annually. Despite Spotify’s valuation tripling since the onset of the pandemic, artists’ share of revenue has not seen a significant increase.
In response to this landscape, traditional record labels continue to profit from legacy music rights without necessitating investments in emerging talent. Universal Music and Warner in France have embraced a new compensation model, initially proposed by Deezer, wherein royalties are only disbursed to songs with a minimum monthly play count and from at least 500 distinct users. Additionally, tracks categorized as “noise” are slated for removal.
A critical challenge facing the sustainability of streaming services is the proliferation of music generated by artificial intelligence and vast catalogs aimed at maximizing royalties without prioritizing artistic quality. This dynamic poses a threat to thousands of artists striving to distinguish themselves in a market increasingly dominated by algorithms.
Consequently, streaming platforms, once heralded for revolutionizing music access, now confront a pivotal dilemma: how to balance offering extensive content with ensuring equitable compensation for artists and maintaining their own economic viability. In the meantime, music enthusiasts may find solace in preserving their vinyl and CD collections, relics of a bygone era in the music industry.
