When a song is streamed on Spotify, the platform has three entities to pay. Understanding who those entities are makes the payment chain much easier to follow.

Who gets paid

  1. The sound recording copyright owner, which is usually the record label. In many cases this payment is made via an aggregator such as IODA, The Orchard, Tunecore or CD Baby.
  2. The song publisher, who administers the underlying composition.
  3. The performance rights organization, which then pays the songwriter.
So where does the musician or recording artist fit in? The artist is paid through the label or publisher chain rather than directly from the streaming service — which is where the aggregator and the contract terms matter.

The role of aggregators

Aggregators such as Tunecore, IODA and CD Baby sit between the streaming platform and the rights owner. They deliver the recording to the service and collect the revenue on the owner’s behalf, then pass it along.

Because a single stream is paid out in fractions of a cent, the delay between a listen and a payment is normal. Accounts are typically paid on a schedule set by the distributor, and money can arrive many months after the month of the stream.

Signed and unsigned artists

SituationWhere the recording payment goes
Signed artistTo the label, which shares with the artist under the recording agreement.
Unsigned artistTo the artist or the rights owner directly, with the publisher and performance rights organization paid their separate shares.
This article was contributed by Christopher Knab of Fourfront Media & Music to the Future of Music Coalition. Reproduced on the White Lion Audio blog on Nov 3, 2020.

Keep reading

Two related pieces in the same series look at the other side of the industry: how to get airplay on non-commercial radio, and how to approach DIY recording as a beginner.

Streaming has become a primary way independent artists reach listeners, and understanding how a single stream splits into payments helps demystify the revenue that eventually reaches a musician. When a track plays on a streaming service, the platform typically distributes money among three main rights holders, and tracing that path makes the overall picture much clearer for artists who are still building an audience.

The sound recording copyright owner is usually the record label, and in many cases this payment arrives through an aggregator rather than directly from the platform. Aggregators act as a bridge, collecting the mechanical and performance-related income owed on a recording and passing it along to the label or the artist who controls the master rights.

The second party is the songwriters and publishers who wrote the underlying composition. Their share comes from performance and mechanical royalties tied to the composition itself, and those amounts are often collected by performing rights organizations and publishing administrators before being disbursed to the writers.

The third entity paid on a stream is the artist or performer featured on the recording, whose share depends on how the deal with the label or distributor is structured. Contract terms, ownership splits, and the number of credited songwriters all influence what ultimately lands in an artist's account at the end of each reporting cycle.

For independent artists working with promotional and management services, this chain of payments matters because it clarifies where leverage and negotiation actually sit. Labels, publishers, and distributors each occupy a distinct position, and once an artist can see the structure of the split, conversations about contracts, releases, and promotional investment become far more productive and informed.