In 2014, the music industry reached a low point when global recorded music revenues hit $13 billion. Spotify’s annual contribution at the time was around $1 billion, with around 15 million paying subscribers.
In 2024, Spotify alone paid out a record $10 billion to the music industry—totaling nearly $60 billion since our founding.
For a lot of people, those numbers might go in one ear and out the other. And they’d perhaps ask why Spotify keeps shouting about it.
It’s because the system we’ve built together is working, and where we are now is only the beginning. Today, there are more than 500 million paying listeners across all music streaming services. A world with 1 billion paying listeners is a realistic goal we should collectively set.
Growing the Pie
There’s a vibrant marketplace of streaming services for different types of consumers, each doing its part to normalize the behavior of paying for music streaming. It’s been a collective effort. But there are a few things specific to Spotify that make it not only the most popular subscription streaming service but also the highest paying.
- Retention is priority number one, and retention is driven by personalization, curation, and product innovation. Fans like the recommendations, the expert editorial curation, and surprise-and-delight moments like AI DJ, daylist, and Wrapped, as well as the access to non-music content. They keep coming back, discovering more new artists, and retaining their subscriptions.
- We offer an ad-supported free tier, while some services don’t. Beyond the ad dollars this generates, more than 60% of Premium subscribers were once free tier users. Bringing in users who don’t expect to pay for music, and deepening their engagement, means they’re more inclined to become subscribers in the future.
- We’re available in more markets and at local price points, meeting people where they are. A decade ago, there was a widely held view that you couldn’t monetize certain markets. But the journey of getting the world to pay for music means making long-term investments. Today, we’re seeing tremendous growth across markets like India, Brazil, Mexico, and Nigeria. These are places where our investments are paying off.
That’s our blueprint and it’s working.
Growing Careers Beyond the Superstars
I recently read a data point from economist Will Page that said more music is released in a single day than there was in the entirety of 1989. In the pre-streaming era, you were either in the club or not. If you didn’t have a label deal or the means to distribute your music worldwide, you weren’t one of the few thousand artists on shelves at a record store or one of the 40 in rotation on a radio station.
Now, you can record something today and have it on Spotify tomorrow. Everyone’s invited. Even better, payments to the music industry have shifted from a concentrated few at the top to an increasingly diverse and growing ecosystem of artists finding success.
Case in point, we estimate that, in 2014, around 10,000 artists generated at least $10,000 per year on Spotify. Today, well over 10,000 artists generate over $100,000 per year from Spotify alone. That’s a beautiful thing.
Think about this: Last year’s IFPI report indicated that Spotify contributes roughly a third of global recorded streaming revenue. But a recent comprehensive study of independent labels and distributors from MIDiA Research showed that Spotify represents more than half of indies’ streaming revenue. What this indicates is that Spotify’s model is uniquely enabling more room for more artists to find success and ultimately sustain a career in music, demonstrating real change across the music business.
Where Do We Go From Here?
Without a doubt, this has been a decade of unparalleled transformation. The global value of music copyright today sits at $45.5 billion. A decade on from its low point, how many other industries have experienced this kind of revival?
Our goal is to help artists get their work in front of existing and future fans, continue to innovate on their behalf, and deliver it in a way that inspires people to pay for it. Onboarding people to paid streaming is precisely what has increased our payouts—tenfold—over the past decade.
Reaching 1 billion paid subscribers across all streaming services will be a collaborative effort, requiring innovation, strategic partnerships, and a continued focus on delivering exceptional value to music fans worldwide. It’s a goal we’re confident we can achieve together.
– David Kaefer,
VP, Music Business, Spotify
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