User growth continued, reaching 20 million total active users, including five million paying customers globally and one million paying customers in the United States, in December 2012. In February 2017, Spotify announced the expansion of its United States operations in Lower Manhattan, New York City, at 4 World Trade Center, adding approximately 1,000 new jobs and retaining 832 existing positions. Later that same year, in March, Spotify removed all limits on the free service tier indefinitely, including mobile devices. Using PC streaming, a similar structure to the one used today allowed the listener to play songs freely, but with ads every 4–7 songs depending on listening duration. In January 2012, the free trial periods began to expire, limiting users to ten hours of streaming each month and five plays per song.
Artificial streams
Spotify supports integration with DJ software, allowing DJs to mix with music streamed from the platform. The testing was very limited in nature and was only available on Spotify's Android app in the US. Some artists included in this initial test phase were Steve Aoki and the Wombats. In November 2021, Spotify hid the "shuffle" button for albums following a request by singer Adele, arguing that tracks in albums are supposed to be played back in the order specified by the artist to "tell a story".
Spotify launched in the United States in July 2011, and offered a six-month, ad-supported trial period, during which new users could listen to an unlimited amount of music for free. It distributes approximately 70% of its total revenue to rights holders (often record labels), who then pay artists based on individual agreements. Unlike physical or download sales, which pay artists a fixed price per song or album sold, Spotify pays royalties based on the number of artist streams as a proportion of total songs streamed.
In March 2023, Spotify announced a partnership with Patreon, which Spotify claimed would "enable creators to expand their creative business through direct payments from fans, and allow fans to listen to their Patreon content on Spotify". In May 2022, Spotify announced a partnership with the online game platform and game creation system Roblox, the partnership saw Spotify as the first streaming brand to have a presence within the game with the launch of "Spotify Island". In February 2018, Spotify integrated with the gaming-oriented voice chat service Discord on desktop clients, allowing users to display their currently playing song as a rich presence on their profile, and invite other users with Spotify Premium to group "listening parties".
- Spotify distributes approximately 70% of its total revenue to rights-holders, who will then pay artists based on their individual agreements.
- Spotify had added social media-related features to its platform, especially to compete for ad revenue and to increase its media-related users.
- Users could purchase tracks from Spotify, which partnered with 7digital to incorporate the feature.
- In December 2024, Harper’s Magazine released a report stating that Spotify was padding out playlists with ghost artists created by production companies in order to minimise royalty costs and increase profits.
- Daniel Ek’s initial pitch to Lorentzon was not initially related to music, but rather a way for streaming content such as video, digital films, images or music to drive advertising revenue.
- Discovery Mode allows artists who meet certain criteria and have a Spotify For Artists account to submit qualifying songs for Spotify’s in-house promotion services.
Direct public offering
In December 2013, CEO Daniel Ek announced that Android and iOS smartphone users with the free service tier could listen to music in Shuffle mode, a feature in which users can stream music by specific artists and playlists without being able to pick which songs to hear. Later that month, Spotify also acquired MightyTV, an app connected to television streaming services, including Netflix and HBO Go, that recommends content to users. While the streaming music industry in general faces the same critique about inadequate payments, Spotify, being the leading service, faces particular scrutiny due to its free service tier, allowing users to listen to music for free, though with advertisements between tracks. In May 2017, Spotify introduced Spotify Codes for its mobile apps, a way for users to share specific artists, tracks, playlists or albums with other people. The company also introduced "Spotify Running", a feature aimed at improving music while running with music matched to running tempo, and announced that podcasts and videos ("entertainment, news and clips") would be coming to Spotify, along with "Spotify Originals" content.
On September 10, 2025, it was announced that Lossless would be rolling out to Premium listeners gradually to more than 50 markets through October. In February 2021, Spotify announced their plans to introduce a HiFi subscription, to offer listening in high fidelity, lossless sound quality. Spotify introduced a Family subscription in October 2014, which allows up to 5 family members to have a premium subscription. The changes faced a mixed reaction from the music industry, who believed that it would be detrimental to emerging musicians, but would make a larger share of total royalty payments available to musicians. In 2013, Spotify revealed that it paid artists an average of $0.007 per stream. Spotify for Artists states that the company does not have a fixed per-play rate; instead, it considers factors such as the user's home country and the individual artist's royalty rate.
Social Media
Today, royalties on all streaming services, including Spotify are paid on a per user basis not per stream as this allows the artists who users listen to the most to receive the largest percentage of the payouts. In October 2017, Microsoft announced that it would be ending its Groove Music streaming service by December, with all music from users transferring to Spotify as part of a new partnership. In 2016, Spotify was criticized for allegedly making certain artists' music harder to find than others, as these artists would release their music to the rival streaming service Apple Music before releasing it to Spotify.
Playlists and discovery
Uploading was free and artists received 100% of the revenue from songs they uploaded; artists were able to control when their release went public. The feature was rolled out to a small number of US-based artists by invitation only. In September 2018, Spotify announced "Upload Beta", allowing artists to upload directly to the platform instead of going through a distributor or record label.
- Spotify has been criticised by artists and producers including Taylor Swift and Thom Yorke, who have argued that Spotify does not fairly compensate musicians, and both withdrew their music from the service.
- In 2013, Spotify revealed that it paid artists an average of $0.007 per stream.
- The standalone app was made available to all iOS and Android users in the United States since 4 June 2019.
- The feature was rolled out to a small number of US-based artists by invitation only.
- In October 2017, Spotify launched “Rise”, a program aimed at promoting emerging artists.
The company also announced an expansion of its book catalogue to 250,000 books. In January 2021, Spotify made a selection of audiobooks available on the platform as a test of developing a greater breadth of content for users. Spotify thereafter announced it was planning to add more of these pages and playlists to highlight songwriters. In February 2020, Spotify announced it would be featuring new songwriter pages and 'written by' playlists. In June 2017, Variety reported that Spotify would announce "Secret Genius", a new initiative aimed at highlighting songwriters and producers, and the effect those people have on the music industry and the artists' careers. On 1 July 2019, Spotify deprecated the program and announced plans to stop accepting direct uploads by the end of that month and eventually remove all content uploaded in this manner.
As of 2022, Spotify is the current playjohnny casino registration sponsor of Spanish football club FC Barcelona, with music artists like Drake, Travis Scott and Ed Sheeran collaborating with the club by changing their shirts into their artist logo, sometimes used for album promotions. Users can search for music based on artist, album, or genre, and can create, edit, and share playlists. Operating as a freemium service, the basic features are free with advertisements and limited control, while additional features, such as offline listening and commercial-free listening, are offered via paid subscriptions. Like HBO Max, YouTube, and Instagram which are also running ads from the campaign, Spotify defended the advertisements by stating they were part of a government campaign, which complied with its ad policies and stated that users could provide feedback or thumbs-down such ads. Some liberal users responded by cancelling their subscriptions and calling for a boycott. According to journalist and author Liz Pelly, Spotify, "under the guise of AI-powered recommendations has developed a surveillance apparatus driven by emotion profiling and pseudoscience."
The functionality is limited to selected playlists and was only available on Spotify's iOS app at launch, being expanded to the Android app in April 2017. In May 2015, Spotify announced a new "Home" start-page that could recommend music. Users can add tracks to a "Collection" section of the app, rather than adding them to a specific playlist. In April 2012, Spotify introduced a "Spotify Play Button", an embeddable music player that can be added to blogs, websites, or social media profiles, that lets visitors listen to a specific song, playlist, or album without leaving the page. In November 2011, Spotify introduced a Spotify Apps service that made it possible for third-party developers to design applications that could be hosted within the Spotify computer software.
Pelly advocated for a move away from the current royalty model that says the artists who people listen to the most should make the most money toward a more generalized approach where the decision for who gets paid rests with industry or government bodies, not audiences. In July 2025, several artists joined a boycott of Spotify because Spotify CEO and co-founder Daniel Ek raised another $600 million in support of German defense company Helsing through his investment fund. Other artists and podcasters, such as Joni Mitchell, Nils Lofgren, Brené Brown, and Crosby, Stills, & Nash, also announced a boycott of Spotify. This policy was revoked in June because the company deemed the original wording to be too "vague"; they stated that "Across all genres, our role is not to regulate artists. Therefore, we are moving away from implementing a policy around artist conduct". In response to the allegations about unfair compensation, Spotify claims that it is benefitting the industry by migrating users away from unauthorized copying and less monetized platforms to its free service tier, and then downgrades that service until they upgrade to paid accounts. Spotify distributes approximately 70% of its total revenue to rights-holders, who will then pay artists based on their individual agreements.
Acquisitions, podcasting and exclusivity deals
In December 2015, Spotify debuted Spotify Wrapped, a program that creates playlists based on each user's most listened-to songs from the year. "Follow" lets users follow artists and friends to see what they are listening to, while "Discover" directs users to new releases as well as music, review, and concert recommendations based on listening history. The applications provided features such as synchronised lyrics, music reviews, and song recommendations. Spotify also offers a proprietary protocol known as "Spotify Connect", which lets users listen to music through a wide range of entertainment systems, including speakers, receivers, TVs, cars, and smartwatches. The company said users would be able to login into the main Spotify app with their Stations account and transfer their stations into Spotify.
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