Math of Music Distribution: Who’s Profiting Off Your Streams?
Where Does Your Streaming Money Actually Go?
Before even considering what a distributor takes, it’s important to understand that you don’t get the full amount from your streams—not even close. Spotify, Apple Music, and other DSPs take a massive cut before anything reaches the distributor, let alone the artist.
While you may have heard that Spotify pays around $0.003 - $0.005 per stream, that’s only true under ideal conditions—specifically if the listener is in the U.S. and paying for a premium subscription. The global average payout is actually around $0.001 per stream. This means that for every 1 million streams, the artist sees around a $1,000 before the distributor takes their cut.
HERE is a link to our handy Royatlies Calculator for different DSPs and countries.
What’s less talked about is that not all distributors get the same money from the streaming platforms. These companies negotiate their own contracts with DSPs, meaning some distributors might have slightly better rates than others. Good luck finding out the specifics—these agreements are about as transparent as a lead curtain. You’ll probably have better luck asking someone from the industry at a bar after their third drink.
DistroKid
Starting off with the big guns, DistroKid is often marketed as the cheapest distribution service because of the $22.99 per year fee. Pretty decent! But if you stop paying, your music gets taken down. There are also extra fees, such as YouTube Content ID at $4.95 per release.
TuneCore
Next up, TuneCore. It has shifted to a subscription model similar to DistroKid. The cheapest plan costs $14.99 per year, but there’s a major downside: you only keep 80% of your streaming revenue. Getting 100% will cost you $49.99 per year. That includes one primary artist. Adding another primary artist will cost an extra $14.99 per year per artist.
Freecords
Freecords offers music distribution at no cost. Artists receive 100% of their streaming royalties without annual fees or hidden charges, with YouTube Content ID included by default. There is no requirement to maintain a subscription, with uploaded music remaining online indefinitely. The first payment is processed quarterly, with all subsequent payments issued monthly. The downside is arguably the 17-day distribution time.
Payment Frequency: How Soon Do You Get Paid?
Annual Cost
We hope this overview has been helpful. Despite its challenges, the music business offers unprecedented opportunities for independent artists today. Wishing you the best of luck and endless inspiration on your creative journey!