Can You Make a Living from Music Streaming Income?

Music

As an artist, being able to sustain yourself off doing the creative work you love is a huge factor when measuring “success.”

According to “Music Creators’ Earnings in the Digital Era,” a report from the UK Intellectual Property Office, 0.4% (around 1,700) of artists on streaming services generate enough streams in the UK to make a sustainable living out of music. This has to mean that the artists are obtaining at least 1 million streams a month. Even so, this amounts to around $3,000 to $5,000 a month.

Even when taking these numbers into account, it is important to note that most of the artists that make up the top 0.4% who stream at least a million streams a month are likely to be signed up by major record labels who often take a significant amount of artists’ royalties. 

Those artists with access to major-label resources also help them to achieve the streaming threshold. Thus, when trying to determine the number of independent, unsigned and/or emerging artists who meet the UK IPO’s sustainable income streaming threshold, the percentage is even lower than 0.4%, most likely in the hundreds of artists.

However, over the past 5 years, the number of artists able to make a sustainable living off of their music has increased 5x, and the share of artists has increased 4x. 

Spotify has published in their Q1 2021 Earnings Report that the number of artists on their platform generating more than $50,000 a year was up 80% since 2017; the number making more than $100,000 was up 85%; and the group making over $1 million a year was up 90%.

Although these numbers have increased, only 0.4% of artists are able to reach this threshold to begin with. This is because success in the streaming industry weighs heavily against artists who do not have major-label resources. Not only does rising competition make it harder for artists to be heard and/or streamed, but also the fact that the overall streaming services are not growing as fast as artists who are releasing new music. For example, Spotify attempts to grow by creating bundles such as for students or family plans, but this makes royalties smaller.

While Apple Music claims it pays a penny per stream to artists, these royalty amounts decline for other services such as Amazon. The UK IPO’s report suggests that the average per-stream royalty rates have gone down by 50% from 2012 to 2020 from $0.02/stream to $0.01/stream. A typical artist today must generate double the streams today as they did in 2012 to earn the same amount of money.

Thus, without major-label resources, it is very difficult for artists to make a living from streaming income alone.

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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