It used to be that the only way to make serious cash as a musical artist was with a smash single. Thankfully for so many acts, that is simply not the case any longer.
Recent data from Spotify, released as part of its annual Loud & Clear report, shows that many artists earned over $1 million on the platform in 2023 without scoring a single hit song. According to the streamer, a whopping 80% of artists who made at least $1 million on the site last year didn’t even crack the Top 50 of Spotify’s Daily Global Songs chart. This signals a major change in how artists find success in the streaming age—and not just smaller acts looking to break into the business, but those who want to build a global brand.
So, why are these lesser-known artists raking in the cash? Well, it’s partly due to the vast amount of money flowing through streaming platforms. In 2023 alone, Spotify paid out over $9 billion to the music industry. With such a massive pool of money up for grabs, even artists who aren’t household names can seemingly earn a decent living from their music.
But it’s not just about the money. The rise of streaming has also led to a more diverse music landscape. With millions of songs available at their fingertips, listeners are exploring a wider range of genres and artists than ever before. This means that niche musicians who might not have made it onto traditional radio playlists can still find a dedicated audience online. While the payouts are known to be low, they all add up.
This shift in the music industry has big implications for both artists and listeners. For artists, it means they have more control over their careers and can connect directly with their fans. They don’t need to rely on record labels or radio stations to get their music out there. Meanwhile, listeners benefit from a richer and more varied music experience, with a treasure trove of songs waiting to be discovered.
Money is available to those who can break through the noise and find a fan base. That’s very difficult, but doable without a major label. The money is elusive, but as time goes on and Americans adopt streaming as their go-to way to listen to the albums, songs, and artists they love—or that they want to try out—more of them are seeing the financial rewards than ever before.
Ultimately, the success of these under-the-radar artists on Spotify is a reflection of how the music industry is changing. While big names will always have their place, the rise of streaming platforms like Spotify has leveled the playing field, allowing artists of all stripes to find their audience and make a living—and sometimes a very good one—from their passion. And with streaming showing no signs of slowing down, this trend is likely to continue into the future.
I spoke with Sam Duboff, Head of Marketing & Policy, Spotify for Artist, about the rise of what one representative for the company called “The Unexpected Millionaires” on the platform and how this trend took hold.
Hugh McIntyre: Do you have a sense of how many artists are actually making a million dollars a year on Spotify?
Sam Duboff: Yes. On our Loud & Clear report, we break down year by year, 2017 through last year, how many artists are generating different amounts of money, from $1,000 through to $10 million. There’s some really interesting trends on the $1 million, $2 million, $5 million, $10 million numbers, where we’re seeing really significant growth. The million dollar threshold in 2017, which was the first year we had data, fewer than 500 artists were generating a million, 460. Last year, it was 1,250. So, huge growth there.
Then going up to the highest threshold we provide data on, $10 million, there’s only 10 artists generating $10 million or more back in 2017. Last year, it was 60. So, if you think of the biggest global superstars, household names, the folks topping the charts all year, it’s a pretty reasonable rule of thumb to assume they’re generating $10 million or more from Spotify alone. As you know, Spotify is about 20 to 25% of recorded revenue. So, you can multiply all these numbers by four, and that’s what they might be getting across all streaming services and CD sales, vinyl sales, other recorded revenue.
McIntyre: Wow.
Duboff: All these numbers are just about Spotify alone. You can multiply them by four to get a picture of what artists might be making across all recorded revenue.
McIntyre: Are you able to share any names that might surprise people in that million category?
Duboff: We don’t share specific names, unfortunately. We do provide a bit of a rule of thumb to help contextualize what it takes to generate a million a year on Spotify. We start to see artists approach a million a year when they have four to five million monthly listeners or 20 to 25 million monthly streams. So, if you think about stream counts you see on Spotify, monthly listeners on the top of artist profiles, that’s the rule of thumb where we start to see at that scale. They may not all be there yet, but that’s when they start to approach a million.
The amount you make effectively per stream depends on where streams come from. So, if you mostly have streams from premium subscribers in the most established markets, you’ll make more than if it’s for more emerging markets. That’s why we can only give a range.
I’m always really surprised by the list of names. I think when people think of that amount of money, a million in a year just from one streaming service, they’re thinking of just the biggest stars in the world.
One of the takeaways we shared this year is 80% of the artists generating $1 million or more from Spotify last year didn’t have a song reach the Global Top 50 any day of the year.
If you think of all the artists who had a song go viral on a video app, who were on year-end lists, were getting Grammy and Brit Award nominations, had a huge sync on Netflix, you take all of those artists, there’s still 80%, another 1,000 artists, who are generating a million who didn’t have a hit song reach that top 50. They weren’t at the top of our biggest playlists. So, you start to see a lot of folks who really aren’t household names, which is really awesome to see.
The revenue opportunity for artists who are doing it not through one hit song that takes off and that success can be hard to replicate. Instead, it’s across their whole catalog, building a fan base year after year.
McIntyre: I think you’re right that if you were to, say, think of the artists who make a million dollars a year on Spotify, a lot of people would point to not only the chart-toppers, but someone went viral or someone had a big moment. So, if you don’t have any of that going on and you’re a musician or a band hitting this milestone, do you have a sense of how these artists get there?
Duboff: Yeah. An interesting data we looked at is one of the hypotheses you may have had is like, “Oh, are these just all more legacy catalog artists who have these huge back catalogs?” What we found instead is the majority of the artists generating a million or more debuted 2010 or later. Their first song ever on Spotify was 2010 or later, which is amazing to see.
So, this list isn’t just back catalog artists. There’s certainly some of that, which is an awesome passive income opportunity for legacy artists. But the majority of these folks started their career as an artist right when the streaming era was taking over or years thereafter, they are building their career in that environment, released a number of albums. There’s way more broad access to music marketing tools and way more equal access to artists wherever they live, having access to the same global fan base, the same set of marketing tools, the same production and distribution technologies.
I think that’s a lot of what you’re seeing with the expanding opportunity at the top, where artists work incredibly hard. They’re at it every week, every year, releasing new music and promoting themselves on Spotify, on social media. None of this money includes touring or merch revenue, which is obviously another big focus for these kinds of career artists.
Honestly, I don’t think there’s any one solution that’s led to this rise of artists making a million on Spotify. It really is the coming to fruition of a lot of the trends we’ve seen in the streaming age, where more people across the world can release music, there’s fewer barriers to entry, there are easier ways to promote yourself as an artist, more opportunities to make it big as an artist. That’s where you start to see the financial outcomes grow commensurate with the evening of the playing field that’s been happening over the past few years.
McIntyre: You said most of them are newer artists, but do you have a sense of the percentage of catalog artists or people who haven’t released anything in a while and it’s one hit from back in the day?
Duboff: I don’t have that data offhand. The majority were 2010 or later. I think there’s a great opportunity for artists to profit off their work for way longer life cycles thanks to streaming instead of having to repackage your work into a greatest hits album that you have to sell and produce in CD stores.
There’s lots of really fun trend pieces about Gen Z listeners rediscovering legacy acts, and there isn’t that barrier to entry of paying for a CD to try all the greats. So, I love the opportunity there for those kinds of legacy artists.
That said, they’re a small minority of the artists generating a million or more. A lot of the success is coming from those actively releasing frontline artists who are building their career now.
McIntyre: Are there any other surprising trends that you noticed when looking through? Maybe there are certain genres that you wouldn’t have seen on this million category years ago that are popping into it?
Duboff: Across all our data, we’ve definitely seen some interesting trends around the success of artists from countries where English isn’t the primary language. I think when you think about the music industry of the past, success at the million dollar a year level was concentrated in just a few countries where they had access to the people with the most resources to invest, where they could get discovered, where they could get the financial support to produce and distribute and market CDs all over the world.
There were 66,000 artists last year who generated $10,000 on Spotify, and the majority of them are from countries where English isn’t the primary language. At the music culture level, there’s been lots of discussion around the rise in Latin music or K-pop in the US or Amapiano or Afrobeats. A lot of that discussion was more about music trends, music discovery, this burgeoning globalization of music. Our data’s showing that’s now translating in financial outcomes.
So, it’s not just that listeners are dabbling in these new genres. Now, the majority of artists making a material amount of $40,000 across all their recorded revenue sources are from countries where English isn’t the primary language. You definitely see that at the $10,000 level. We’re seeing a lot of new global superstars and the Afrobeats, Latin music, K-pop genres too. You’re seeing a broadening of the artists able to reach a level like a million dollars a year and just way more global access, where the artists who are reaching that level are way more reflective of the world we live in and music tastes around the world.
McIntyre: What do you think this says about the streaming music economy?
Duboff: One of the ways we’ve been thinking about Loud & Clear this year is the moment in time we’re in in the music industry, where 20 years ago is when piracy started to really blindside the industry and really ravage the revenue opportunity for artists. The low point of the industry was 2014. So, exactly a decade ago. That’s when recorded revenue hit-
McIntyre: The lowest.
Duboff: Globally and in the US. In 2014, Spotify was only paying out $700 million a year. So, you’d hear lots of discussion 10 years ago about, is streaming ever going to provide that big financial opportunity? Is it going to make a better future or is it just an experiment? Here we are, 10 years later, where Spotify is paying out $9 billion-plus a year, not $700 million. It isn’t just a few global superstars making, say, a million a year, it’s 1,250 and these are career artists, non-household names, folks a lot of people haven’t heard of.
That’s at the million dollar level. 60 artists generating $10 million from Spotify alone is pretty amazing. I think there’s a lot of perception people have that’s rooted back in the early 2010s, where streaming was a bit of an experiment and people had to take a chance on services like Spotify to see if we could get to the scale to see these kinds of outcomes. So, it’s understandable that there’s some lag in… Some of those misconceptions take a while to correct when there was a truth a decade ago, and it’s not the case right now.
That’s why we do work like Loud & Clear because all we can really do is share a bunch of the data about it and be as transparent as we can. No other streaming service discloses data like this right now. We really feel like artists deserve to understand in as much transparent detail as possible what the revenue opportunity is in streaming, and I think we’ll start to see as people entrust data like Loud & Clear and hear stories from artists that there is this really vibrant opportunity for artists in the streaming age that really wasn’t the case a decade ago.
McIntyre: Just looking at how much this has grown since 2017, the number of people making real money on Spotify, do you at all forecast?
Duboff: We don’t set goals like that so specifically. In 2017, we paid up $3.3 billion to the music industry, and it was over $9 billion last year. That’s why we have seen in that six-year span a nearly tripling across all the thresholds. So, from a thousand dollars through to $10 million every threshold more than tripled or nearly tripled since then. We certainly expect that type of growth to continue, but we don’t set hard goals on it. But each and every year, we’ve continued to increase our record payouts to the music industry, including the $9 billion last year.
