Everyone knows that Spotify doesn’t play fair when it comes to giving artists their cut, but just how exploitative is the popular streaming platform? Below is all the information you need to decide for yourself; in light of the recent proposal to slash songwriter royalties even further. To understand how ‘fair’ Spotify is, we must first take a deep dive into how *any* income generates through music before moving on to how the revenue splits between rightsholders, songwriters, and artists.  

• What many don’t understand when they look at an artist’s income per stream is the legal framework that enables artists to get paid in the first place; copyright law is a major factor in deciding where the revenue goes.
• There are two assets copyrighted on Spotify; the song and the master. Additionally, there are extra exclusive rights that come with ownership of copyright material. For example, when a record label makes a CD, the songwriter must be paid for every sale. 
• Streaming is considered a public performance and mechanical use of a songwriter’s work. The streaming income is collected via the Performance Rights Organization before being paid to the songwriter and the master’s rightsholder (a rightsholder owns the master recording – usually a record label for signed artists). Rightsholders usually receive 15-20% of the revenue. 
• If an artist is independent, the revenue will be passed to the distributor, minus the distribution fees. 
• Spotify pays 75% of the total revenue to publishers, rightsholders and songwriters. 15.1% is for publishers and songwriters, 59.9% is for sound recording owners. 
• Royalties are paid when the total number of streams is added up and divided by the revenue percentage; this is how prices per stream are calculated. 
• The pay per stream varies by country, and it makes a difference on the value if the streams came from a free or paid Spotify account. 

As this pro-rata model of generating income on streaming services has become the standard, it is unlikely that there will be a revolution or increase in revenue for songwriters any time soon. The problem for up and coming or independent artists is so much larger than Spotify being unfair; for real change, the whole industry has to innovate around the necessity of fair pay for artists. 

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