Spotify ends royalty payments for tracks with under 1,000 streams

The streaming company has confirmed its latest policy change.

Photo credit: Reet Talreja on Unsplash

As of April 1st, Spotify has enacted a policy change that no longer pays royalties for tracks with fewer than 1,000 streams. This change was initiated by a report showing that 99.5% of all streamed tracks had over 1,000 plays.

Spotify asserts this change will not affect the overall royalty pool for rights holders. The intention is to redistribute millions of dollars to tracks that meet the criteria, instead of disbursing small payments of US$0.03.

Music labels must withdraw a minimum amount in royalties, usually between US$2 and US$50. Due to banking fees, smaller payments often don’t reach the uploaders. To discourage artificial streaming, Spotify now requires a minimum number of unique listeners for royalties to be paid.

Previously, ‘functional genres’ could earn from 30 seconds of play. This has now been extended to two minutes.

According to Bloomberg, Spotify plans to increase its subscription prices. After raising the Premium service cost last year, similar price increases are expected for the UK, Australia, Pakistan, and the US. Individual plan costs are anticipated to rise by $1 per month, with Duo and Family plans increasing by $2.

For more in-depth information, refer to Spotify’s ‘Modernising our royalty system’ report here.