A Musician's Guide to Streaming: The Pros & Cons of Spotify, Bandcamp, SoundCloud & More

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A Musician's Guide to Streaming: The Pros & Cons of Spotify, Bandcamp, SoundCloud & More

Where to put your music as a beginning artist can be a daunting question. Every online service has pros and cons, and different programs work better for different genres, artists and scenes. Finding the right distribution method can be tough, and the industry is still going through growing pains when it comes to royalty payments.

Knowing the ins and outs of each distribution service is vital as an artist, so here’s a look at six prominent mediums and what they have to offer.


Bandcamp is frequently used by smaller bands and labels to distribute music cheaply and efficiently. The structure of the site allows for easy downloads as well as streaming, and Bandcamp allows bands to name any price for a download. Customers are also able to buy physical releases and merch from a band, listed underneath the digital option.

Bandcamp’s payment program is simple: the company takes 10 percent of merch sales and 15 percent of downloads. After a seller reaches a $5,000 profit, then the Bandcamp cut drops to 10 percent of digital profit. Revenue is linked to a seller’s PayPal account, so that $5,000 can come from any number of releases and artists directed to the same PayPal account.

For $10 a month, an artist can upgrade to a Bandcamp Pro account, allowing the seller to send out discount codes, use private streaming options and access in depth analytics.

Bandcamp has been lauded for its artist-friendly business and design, making it a good choice for indie musicians. The only downside is that no revenue is generated from album streams, so if you like an artist and want them to make some money from Bandcamp, make sure to buy an album once in a while.


Whereas Bandcamp allows artists to put music up for free and then takes a revenue cut, Soundcloud goes the opposite direction. Free accounts are allowed only two hours of upload time, so to really get the most out of Soundcloud, you’re going to have shell out some money up front.

A Pro account costs $6 a month or $55 a year and allows for four hours worth of uploads. An Unlimited account costs $15 a month or $135 a year, and you’d expect, allows for unlimited uploads, though users are only allowed to add 30 hours of music each week.

The extended accounts allow for more downloads, analytics and let a user spotlight five songs at the top of his or her profile. Pro and Unlimited users can also turn on Quiet Mode, making comments and statistics private.

However, Soundcloud does not directly pay royalties for streams. If you’re looking to get paid for streams, you’ll have to partner up with non-profit SoundExchange and license your music, making Soundcloud more of a tool for sharing rather than selling. Links to iTunes can be included as a Buy button, however.


How much YouTube pays songwriters for featuring songs on its service is hard to find out, as Google has artists sign a non-disclosure agreement. It doesn’t appear to be much, however.

According to a piece by The Guardian, an anonymous songwriter reported a profit of $80 for nine million plays. YouTube also does not have performance rights agreements in every country with the service, so some views do not actually count toward royalties at all, but still bring in advertising money for YouTube.

Even in the U.K., where YouTube does have a deal with the Performance Rights Society, the video streaming company pays a lump sum for licensing, which is then distributed among songwriters. This model means that the popularity of a song makes little difference for royalties.

The best bet for generating a profit at YouTube is by generating enough views to become a a premium partner and earning money through advertising. While YouTube is very useful for sharing music and especially live performances, don’t go into it expecting to generate a significant profit.


Spotify often catches a lot of flack for its royalty payments which range between $.006 and $.0084 per stream. The company claims that a small indie band makes about $3,300 a month off an album, while a highly successful indie band makes $76,000, but several artists like Zoë Keating have claimed to received only $808 from more than 200,000 streams on the service.

While it does not directly cost to put music on Spotify, the service only uploads music from labels and distributors. If you don’t have a label, then you’ll have to go through an artist aggregator. Some services like Tunecore charge a yearly fee for distribution, while others such as CDBaby take a small cut of net earnings.

Spotify does allow artists to put merchandise up for free on their profiles, and no cut is taken for merch sales. However, only three items can be listed at a time.

According to Pandora, one million plays results in about $1,370. That money is then divided among the label, songwriters and performers, which makes for a very small sum of money awarded to each musician.

However, it is worth noting that while it’s hard to make money on Internet radio like Pandora, it’s even harder to make money off terrestrial radio. AM/FM stations only have to pay a songwriter’s royalties, not performers.

So while Internet radio services such as Pandora may not pay much, having your music on there is still a bit more lucrative than traditional radio. Getting your music on Pandora requires that your music already be on a service such as iTunes or Bandcamp, and similar to Spotify, royalties can be collected through a label or SoundExchange.

iTunes has long been a dominant distribution medium for music—relying on downloads more than streaming—and getting music on the program is fairly streamlined. However, for smaller artists, the costs can sometimes trump the benefits.

Most artists have to use an aggregator to get music posted, meaning that a payment plan with the aggregator will have to be used. iTunes then takes around 30 percent of sales from music. While this is a bit more costly than other services, the popularity of iTunes does make it an appealing service. Downloads from iTunes also easily go onto an iPod or other device, which makes music more readily accessible for fans.

Other Options
Rdio, Beats Music, Rhapsody, Napster and Google Play Music, work on a similar model to Spotify, but the latter four don’t have a freemium model, meaning royalty payments are typically higher (an accounting from an anonymous indie label shows Google Play paying nine times what Spotify pays—even Rdio shows a significant per-stream increase from Spotify). Deezer also works similarly to Spotify and is available in nearly 200 countries—just not the U.S. Slacker Rdio and Samsung’s new Milk Music operate more like Pandora. Using a service like SoundExchange can earn royalties from the likes iHeartRadio and SiriusXM, as well as Pandora. Xbox Music, while relatively small compared to the other services on this list, has become known for paying much higher royalties than its peers.

Some musicians like Camper Van Beethoven/Cracker frontman David Lowery, have argued that no streaming service pays enough to sustain musicians, and it may not even be enough to sustain companies like Spotify that rely on the freemium model. There’s still a lot of shaking out to happen in the music-streaming industry. We’d love to hear from musicians about their experiences with any of these streaming sites and others. Please add your comments below.