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Spotify's New Royalty Model

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Octiive Support
February 15, 2024

In response to the dynamic nature of the music streaming industry, Spotify is introducing notable adjustments to its royalty model. These changes aim to optimize operations, address fraudulent activities, and uphold fairness in compensation across the platform.

One significant update is the introduction of a minimum threshold for royalty qualification. Tracks will now need to achieve a minimum of 1000 streams from at least 50 unique listeners within a 12-month period to be eligible for royalties. This modification is intended to simplify data management while ensuring that royalties are distributed to artists who have garnered significant engagement.

Moreover, Spotify is taking a proactive stance against streaming fraud with the implementation of a penalty system. In cases where 90% of a stream is identified as artificial, a 10 USD charge will be imposed. This measure targets practices such as bot-generated plays and identity theft for false plays, aiming to maintain integrity within the streaming ecosystem.

Additionally, there are now guidelines for noise tracks, including a two-minute minimum length requirement for functional noise recordings. Genres impacted by these guidelines include white noise, nature sounds, machine noises, sound effects, non-spoken ASMR, and silence recordings. Notably, streams of noise content will be valued at one-fifth of the regular rate, reflecting the distinct nature of these compositions.

These updates underscore Spotify's commitment to fairness, transparency, and sustainability within the music industry. As the platform continues to evolve, it remains dedicated to supporting artists and creators while fostering an environment of equity and opportunity for all stakeholders involved.

We will continue to monitor developments and update our readers as soon as we know more details regarding Spotify's evolving royalty model. Stay tuned for further insights and analysis.