Ed Sheeran, the most-streamed Spotify artist of 2014, has become only the second act to hit two billion streams on the service.
How does that translate into cold, hard cash? Well, the honest answer is that we don’t know, exactly – but we can form a rough estimate.
According to Spotify’s own figures, each track on its service generates somewhere around US $0.007 per play for music rights-holders.
Take Sheeran’s colossal playcount – amassed across just two albums – and multiply it by that sum, and you get to a very tidy $14m (€13m).
Of course, we have no visibility over where that money then ends up after Spotify has paid it out.
Recent research from SNEP/Ernst & Young in France suggests that major labels keep around 73% of payouts from Spotify, with artists taking 11% and songwriters/publishers being granted 16% between them.
That high label percentage figure is justified by labels in terms of costs related to the release and marketing of music.
“Ed and Atlantic have truly embraced the power of the spotify platform.”
Kevin Brown, Spotify
Yet it is entirely possible that the management of an established superstar like Sheeran have negotiated a more favourable royalty rate with his label, Atlantic, than that which is typical.
Sheeran is therefore likely to be netting more of the pie than an average performer – especially considering he writes or co-writes his own songs.
Sheeran is the first British artist ever to break Spotify’s 2bn milestone, and only the second artist to do so in Spotify history behind Eminem.
Mark Mitchell, General Manager, Atlantic Records UK said: ‘Ed achieving two billion streams on just two albums is a phenomenal achievement. It not only highlights the popularity of his timeless sound and the explosive growth of his army of fans, it also demonstrates how great music can be successful on all formats.
“He’s already topped charts around the world with ‘x’ but we’re not stopping, he’s midway through his world tour and we’re still working as hard as ever to help him smash even more records.”
Kevin Brown, Spotify’s head of label relations for Europe commented: “Breaking the two billion streams barrier on Spotify is evidence – were it needed – of Ed Sheeran’s enormous popularity among the 60 million music fans on the service. Ed Sheeran is quite simply one of the best-loved artists on Spotify globally, and we are thrilled that he has achieved this milestone.
“Ed and Atlantic truly embraced the power of the Spotify platform with the launch strategy for ‘x’. This made a significant contribution to the phenomenal launch success of the album on Spotify through connecting it with the widest audience possible.
“That it continues to be enormously popular with our users almost a year later and is still winning new fans is testament to the quality of the album and the enduring appeal of Ed as an artist.”Music Business Worldwide