How Many Spotify Streams Does it Take to Live Above The Poverty Line?

Artists have a hard time living solely on Spotify streams, but how many plays would a musician need to live above the poverty line? Here’s the math.

We are in the middle of a streaming war. Spotify, Apple Music, Amazon, Pandora, Youtube, and more, are services offering a platform for artists to upload their music to get discovered. As of January 2020, Spotify has more than one hundred million monthly subscribers worldwide. Apple Music and Amazon Music are trailing right behind them, gaining millions of new users each month. Each company pays its artist a royalty per stream. The question now is, how many streams does a musician need to live about the poverty line?

Before Spotify, artists use to have to rely on physical sales of their printed CD’s. And of course it costs money to print all those CD’s to distribute, along with the artwork and casing. Then you would have to hire a distributor with the ability to put it on the shelves of the hottest music stores around, then pay the stores a fee for each CD sold through their store. The labels of course would have to collect what they spent on the creation of the album (studio time, engineers, producers, marketing, branding), and if advances were given, those would have to be repaid first before an artist see’s a dime from the sales.

That was the old way.

Now we have streaming payouts which are a relatively new revenue stream for musicians. Now you can record and make music at home, release it through a distributor such as Distrokid or Tunecore, and collect your earnings directly based on how many steams your music gets. Now just to be clear, no one is suggesting an artist survive on streaming royalties alone. Tour revenue, and merchandise are still a huge part of an artists’ income needed to sustain a living, but streaming revenue can certainly provide extra change for the pockets. How much extra?

According to the Assistant Secretary for Planning and Evaluation (ASPE), the poverty line for single-person households is $12,760. So that obviously seems pretty low but if we are going by that metric, let’s round up to $13,000 and use streaming revenue calculators to figure out how many Spotify streams someone would need to sustain themselves.

At an average payout of $0.006 per song stream, a musician living in the United States needs roughly 3,250,000 plays annually to have a gross income of $13,000. 

But what about people with families? The ASPE puts the poverty line for a family of four (2 adults, 2 children) at $26,200. Using the same average royalty rate, a musician would need 6,550,000 Spotify streams to earn that amount of gross income.

These numbers get much bigger when the musician is part of a larger group. If a band has four members and all four have families where they were the sole source of income, the group would need to generate 26,200,000 Spotify streams to gross enough so each member’s family would be at or above the poverty line.

So once again, no one is saying an artist should survive only on streaming royalties. Some will be able to make it work, depending on their following and overhead costs, but most will need to create as many revenue streams as possible to survive. Concert tickets, physical media, and merchandise have always been a big part of an artists income and will continue to be so in the future.