How to Make a Career from Online Music Streaming

Music streaming has become the main way for your fans to consume music. Yet as an emerging artist, it can be hard to even get music on streaming platforms, let alone earn money from them. So how do you make a career from online music streaming?

How Do Platforms Make Money?

There are number of streaming platforms, too many for an artist to post all their music on. In fact, you should concentrate on just one or two platforms.

The main platforms are Spotify and Apple Music. Both streaming services make revenue in a similar way, through subscription and advertising models.

Streaming services run and play adverts between tracks, which are paid for by the respective companies. If listeners do not want to hear advertisements, then they just pay for a subscription. This way, the streaming company takes an income if you are paying or not.

How Does That Transfer to Artists?

The way both companies transfer money to the artist is on a pro rata method. Both companies give 70% of the income generated from subscriptions and advertising to artists. However, many people do not agree with how this 70% is divided out.

From this large pot, you are paid based on the percentage of all streams. So, if the pot was $100 million and you accounted for 1% of streams, then you would get $1 million.

While this may sound fair, as an emerging artist trying to forge a career, it means that hundreds of people could listen to your song and you get very little. In theory, only the biggest artists will get paid well. As an example, the average pay for a Spotify stream is a mere $0.005.

Some platforms, such as Deezer, are moving towards user-centric models. This is where an artist is paid every time their song is played by a subscriber, from that person’s subscription fee.

Streaming Must Have Some Good Points, Right?

Despite the many voices against how streaming revenue is allocated, there are a lot of benefits. The first, is that you are getting paid.

Many people do not realize that unless you are a songwriter, you would not get paid for a radio play. In the past, people made money from mechanical sales (records, tapes) or royalties if they were a songwriter. Anyone else would not have seen a penny, yet with streaming you are at least getting something.

The second is that streaming has an echo chamber effect. Due to its recommended artist sections and voting systems, you are opened to an audience and given exposure that was previously unheard of.

This works in the same way with similar artist recommendations. If someone plays the Smiths, and your band sounds like them, then you have a direct line to people who will engage with your sound. It is the digital equivalent of supporting your favorite artist on tour.

Streaming as a Promotion Method

The truth is unless you are a huge artist racking up millions of plays, you are not going to make enough to sustain a living. The trick is to look at streaming as a promotional tool as opposed to a way to make money.

This can be divided into two parts. The first is to set up your streaming channels to gain maximum exposure and high-quality followers. The second is to set up systems to make revenue once you have followers.

Maximizing Your Potential

The first thing to do is make sure your profile pages on streaming sites are perfect. They need high quality images, that reflect the aesthetic and image of you or your band. Secondly, you need all your information filled in, from the music you like to your social media links.

Finally, get your genre and similar artists exact then get sharing. Post your links on social media and send them to friends and family. Tell people you are on streaming sites and get fans to add you to playlists and compilations. Only once you have collected fans via streaming, should you start to think about monetization.

After the Stream

The truth is, you will make very little from plays online, so get some killer merchandise and physical products that you can sell once fans are onboard. Direct fans to a website or shop using your streaming profile page and let them know that buying a record supports you as an artist. You may even use it to crowdfund your next record!

Eventually, you may even get to a point where you have enough fans that streaming does become profitable. The golden rule is that everything takes time, and remember every overnight success is at least three years in the making!


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