After reporting earlier this week that the streaming service giant is apparently looking for more funding, we’re learning today that Spotify’s royalty rates are slow to rise despite a substantial increase in subscribers last year.
As Hypebot has mapped out, the average indie artist only saw a revenue/royalty-rate increase of $0.001 on Spotify in the past year. This comes after reports last week (via PCMag) that the service is up to three million paid users already; it was at two million in September.
That’s 20 percent of its user base and it will likely only increases as free listeners hit the limited usage cap after six months. That is, of course, if they decide to fork over the $4.99-$9.99 per month to subscribe.
Here’s Hypebot’s advice for indie artists:
I have said it before and I will reiterate this point – use Spotify as you do all other free streaming services like Reverb Nation, Myspace, Root Music and Soundcloud. Put two or three of your songs up and try and entice people to your own website to discover more.
What do you all think about this? Should indie artists use it more as a promotional tool and not allow their full projects to be streamed?