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This is not how they pay out subscription $. They do not pay per stream. While the payout algorithm is highly complicated, essentially it is a % of subscription
by numbp4d 3y ago
This is not how they pay out subscription $. They do not pay per stream. While the payout algorithm is highly complicated, essentially it is a % of subscription dollars distributed pro-rata by stream count to copyright holders (where a 1 stream is at least 30s of listening).
- delusional 3y agoAh, so consumption is entirely decoupled downstream payment? That's interesting. Thanks for telling me.
- numbp4d 3y agoConsumption is directly linked to ultimate payments by Spotify to copyright holders. However it is not done on a per stream basis. It is paid out of a pool of earnings on a pro-rata basis. Each copyright holder negotiates its own formulas with Spotify / others for payouts, however they all have some version of the pro-rata payout system. So in the sense of direct financial incentive, it would be best to drive customers toward music where the payout formulas are the lowest (e.g. their owned content), assuming it wouldn’t increase churn or reduce premium sign ups.