The Spotify ‘Loud & Clear’ report 2024: Charting is not needed to earn money
Spotify
Spotify’s “Loud & Clear” report for 2024, is out now. It provides a comprehensive analysis of the platform’s financial contributions to the music industry. The report itself is accessible at Loud & Clear Report.
We went through it and checked some of the findings related to the indie music scene.
With 2024 payouts reaching $10 billion, Spotify – like it or not – executed the largest single-year payout by any retailer in music history. It also represents a tenfold increase from $1 billion in 2014, which clearly shows the platform’s exponential growth. Since its start Spotify’s total payouts, including both recording and publishing royalties, have reached nearly $60 billion, nearly 25% of global recorded music revenue in 2024, up from less than 15% in 2017. If Spotify’s payout would be multiplied by four it would include all recorded revenue sources in 2024.
Note that global recorded music revenues have also more than doubled since 2014, growing from $13 billion to over $28 billion in 2023, as per the International Federation of the Phonographic Industry (IFPI).
You don’t need to chart in order to earn Spotify money
Something that struck in the report is that in 2024, nearly 1,500 artists generated over $1 million in royalties, with 80% not appearing on the Spotify Global Daily Top 50 chart. The majority of these high-earning artists started their careers post-2010, and… over 80% are touring.
The key is building a loyal fanbase on the platform, which comes more naturally to touring bands than to studio-only projects that struggle to reach a wider audience. Studio-only projects must put in extra effort to connect with their target listeners.
Note also that independent artists and labels collectively generated over $5 billion, accounting for about 50% of total Spotify royalties.
More than half of artists generating at least $1,000 in royalties saw most of their income from abroad, with nearly one-third generating over 75% of their royalties internationally. Music in 17 languages generated at least $1 million in royalties in 2024, up from previous years, and over 50 languages saw at least $100,000, also an increase. Notably, eight languages each earned over $100 million in 2024, compared to only English and Spanish in 2017.
The value of streaming has also risen, with one million streams generating over $10,000 on average in 2024, a tenfold increase from $1,000 in 2014. That’s caused by the rise of paid subscriptions over the years.
Small bands and Spotify, the battle goes on
As we reported before for smaller bands, there is still the minimum stream threshold. Spotify demonetizes tracks that receive under 1000 plays annually. That has already impacted over half of all songs on the platform, as only 37.5 million tracks have surpassed 1000 streams historically. Tens of millions of dollars from the 0.5% of artists receiving under 1000 streams annually is now redistributed to the other 99.5% of the royalty pool​​.
The main issue for small bands nowadays, apart from the revenue per stream, is not being ‘discovered’. With over 100 million tracks on Spotify, small bands struggle to get their music discovered. Getting featured on popular playlists or recommended by Spotify’s algorithms still is crucial for increasing streams, but this is often out of reach for bands without existing fame or marketing budgets.
The platform’s reliance on algorithmic playlists like Discover Weekly can help, but small bands typically lack the data or fan base to influence these recommendations. It’s also important to note that you need an initial grassroots boost to get noticed by many of these playlists, creating a classic chicken-or-egg dilemma. Many small bands resort to fake pay-for-play schemes to overcome this hurdle, but Spotify is – rightfully – constantly cracking down on them.
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