The Big Green Circle has made Spotify CEO Daniel Ek a lot of money over the past 12 months, with four… Sale of shares Since July of last year, Ek has grossed around $345 million. This led royalty accountant Hunter Giles to wonder: how many streams would it have taken for Ek to earn the same amount of money through his own platform? The answer may surprise you (Narrator: They weren't surprised).
Giles and the Infinite Catalogue team Newsletter A “generous” estimate of $0.003 per stream was used, as well as assuming that artists own their publishing rights and masters, which rarely happens. To earn $345 million in a year, an artist would need 115 billion equivalent streams in 12 months – 15 billion more than Spotify’s most-streamed artist, Drake, has grossed in his entire career.
The full breakdown is hereAnd Giles also shared this chart, which converts stock values into streams and shows where different Spotify executives would rank in the all-time stream rankings.
One small detail that I’m not entirely convinced by is that Giles writes, “Ek earned more in 12 months than any other artist on Spotify.” That’s a good guess based on public information, but I don’t think it’s a confirmed fact. Spotify doesn’t pay artists per stream; it uses a secret formula, and royalties differ based on the deals Spotify strikes with labels and artists. In other words, some artists get paid more than others. So higher payouts for Drake or Taylor Swift would mean Spotify gave them more over their careers than Ek earned in 12 months.
Still, this is a year of stock sales compared to the past 15 years of streaming. The general point is the same: the artists who generate the most value for Spotify aren’t getting anywhere near as much money as the CEO, which is fine by Ek since, according to him, creating music “content” costs “almost zero.”
All in all, this seems particularly hypocritical given recent changes at Spotify. Earlier this year, the company announced a new royalty model that is estimated to pay songwriters $150 million less in its first year. They also just raised prices, which may have helped them achieve record second-quarter profits and led to the recent stock bonanza.
Ek isn't the most-streamed artist on Spotify, but judging by the company's stock, he's the only one holding the number one spot.
thanks to our partners at consequence.net
