Spotify looks set to overhaul its royalty model next year

Spotify's royalty model will get a massive revamp next year to give "working artists" a bigger cut, according to Music Business Worldwide. Starting in the first quarter of 2024, Spotify will reportedly implement three changes meant to "combat three drains on the royalty pool." The first one is establishing a minimum number of annual streams a track must reach before it starts generating royalties, which is supposed to demonetize tracks that earn less than 5 cents a month. Apparently, while these tracks make up a tiny percentage of music on the platform -- 99.5 percent of all monetized content will still be earning money after this change -- their royalties still cost Spotify tens of millions of dollars a year. Based on Music Business Worldwide's computations, a track has to generate 200 plays a year to be able to earn 5 cents.