An overview of all changes for the coming year

Spotify has recently introduced new policies that will affect, among other things, the future distribution of royalties (from 2024). In this article, we would like to give you an overview of the announcements.

Fraudulent activities

Despite Spotify’s investment in detecting and preventing artificial playback, there are still fraudulent activities on the platform. To counteract this, Spotify plans to introduce label and sales fees from next year, when obvious artificial reproduction is detected.

New rule for “noise tracks”

The popularity of “functional” genres such as white noise, natural sounds or static sounds presents new challenges. Some Spotify users will shorten these recordings to get more royalties. To counteract this, Spotify will increase the minimum length for functional noise tracks to two minutes from next year and set the value of such streams to a fraction of music streams.

Royalties generated from 1,000 streams or more

From now on, tracks must have at least 1,000 streams in the last 12 months to generate royalties.

Spotify justifies this as follows: With over 100 million tracks on the platform, there are millions of songs streamed between 1 and 1,000 times a year, generating an average of just $0.03 a month. Smaller payouts are often forgotten, as labels and distributors have minimum payout amounts. The unpaid money amounts to around 40 million dollars per year and should be benefiting the artists entitled to it.

According to Spotify, the changes are expected to generate an additional $1 billion in revenue for emerging and professional artists over the next five years.

What’s next?

Spotify’s announcements will understandably raise many questions. Of course, we will keep you informed of further changes and keep ourselves up to date with the impact of these changes. We are here to help. If you have any questions about this or any other topic, please feel free to get in touch with our support team.

You will find the full announcement from Spotify, including more details and justification, here.