Spotify's Record $10B Payout Sparks Royalty Debate

In 2024, Spotify paid out a record $10 billion in royalties, marking a significant milestone as the largest annual payout to the music industry by a single retailer. Despite this, the distribution of royalties remains a contentious issue, with many artists claiming that they receive inadequate compensation compared to other streaming platforms like Apple Music and Amazon Music. Spotify asserts it pays rights-holders, such as record labels and publishers, who then distribute the money based on individual contracts with artists. The company's Loud and Clear report aimed to provide transparency but has not quelled criticism, particularly from songwriters affected by Spotify's bundling strategies that reduce royalty payments. Notably, Spotify highlighted growth in diversity among artists earning substantial income, with increased international and linguistic representation. Although Spotify's payouts have increased tenfold over the past decade, artists continue to express dissatisfaction with the payment structure and overall fairness.