The answer to that is: very little. In fact, in a recent report, the European Commission states that the average revenue per stream is between €0.03 and €0.04.
So Spotify has pretty much paid the licensing fee. The only other factor of note is that Spotify has an exclusive agreement with the RIAA, which restricts the rights rights of the recording artists (i.e. record labels and publishers). They can only use this in Europe with a royalty fee.
What else are the fees for?
Well, there are many other fees and costs – it ranges from what you get to how much you have to pay if you try to use your license to download an album.
When your license is expired, you have to pay a penalty. The fee will be increased every year, unless it is reduced (or the user is a member of the European Union – which doesn’t always happen). The minimum level is €0.30.
What are the fees for licensing songs?
When recording a song, both labels and publishers pay to the artist what they are legally entitled to. This means that you will get the same amount as artists paying license fees.
However, publishers often use this money to buy themselves more music – because the music they buy is in demand, it can be used for their own products.
So what does the EU think about the licensing fees?
The EU commission states that the fees for licensing artists are unfair, since it affects the user’s freedom of choice.
Therefore, the commission decided that we should make changes to the licensing agreements so that it’s easier for consumers to know what they are entitled to.
The Commission has now proposed that, for future music licensing agreements, the level should be fixed so that it is comparable with the current agreement with users in Europe.
What do users think?
Over the years, there have been a lot of questions raised over the licensing fees.
The EU states that that they think that the fees are very low which is fine in our eyes. However, as a consumer, you should be aware of it.
To download all of the songs contained on Spotify is quite complicated, as there is no way to find out what you really got for it.
Why not just pay by credit card or other way?
The way we have found to make an agreement with the labels is not ideal. We believe that the
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