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Popular streaming playlists can boost a song's revenue by up to $163k

Artists lucky enough to find their song on 'Today's Top Hits', a Spotify playlist with over 20 million followers, could see a boost in popularity worth between $116k and $163k in additional streaming revenue.

Playlists also have a big influence on the success of new artists and new songs. Getting to the top of Spotify's 'New Music Friday' playlist in the US boosts streams by around 14 million, worth between $84k and $117k in additional revenue.

'New Music Friday' playlists provide a weekly, country-specific selection of 50 tracks recommended by Spotify. All the songs are new and just over half come from independent labels.

The findings come from a study by the Joint Research Centre, the European Commission's science and knowledge service, on the impact of Spotify playlists on a song's success. Scientists analysed:

• How many times a song is streamed before and after its inclusion on major global playlists and algorithm-based 'Global top 50' playlists;
• The effects of inclusion in the 'New Music Friday' playlists on song success;
• Whether 'New Music Friday' playlists can help in the discovery of new artists.

The study finds clear evidence that Spotify has a powerful role in influencing users' listening choices by deciding what to include on some of the platform's most popular playlists. The results also indicate that 'New Music Friday' playlists help in the discovery of new songs and artists.

The findings are interesting for music industry participants, listeners and observers of platforms more generally.

Discovering music in the digital era

The means through which we discover and access music have evolved over the past few decades, with improvements in mobile internet technology helping streaming to become an increasingly significant channel. Sweden-based Spotify has emerged as the most prominent platform, with a 37% share of the subscription streaming market.

Streaming has also given users access to a much higher volume of music than through traditional terrestrial radio and music retailing. Spotify users have access to 35 million tracks with any internet-enabled device.

In theory, the access to this volume of content gives music lovers the opportunity to discover music from a vast array of sources, including independent record labels and foreign producers.

Conversely, access to such a large catalogue creates a daunting problem of product discovery, with the risk that new music and emerging talent could become lost in a sea of content.

Fee-paying platforms like Spotify seek to add value by helping listeners to discover the music they like, whether through playlists or personalised suggestions.

Commission support to the European music sector

The study contributes to scientific evidence on how digitisation and online distribution have altered revenue streams and led to new consumption patterns, with implications for the music sector.

The European Commission seeks to ensure that artists receive fair remuneration for the online exploitation of their work.

Music Moves Europe is the overarching framework for the European Commission's initiatives and actions in support of the European music sector.

It aims to help the sector flourish, to adapt to new challenges and to reap the benefits of digitisation. Through the initiative, the Commission wants to build on and further strengthen the sector's strong assets: creativity, diversity and competitiveness.

Its specific objectives are to:

• Promote creativity and innovation;
• Safeguard and expand the diversity of European music;
• Help the sector adapt to and benefit from digitisation.

The Commission will also strengthen dialogue with the music industry to explore needs as they develop and identify possible fields of action where the EU can add value. These actions aim to ensure that all rights holders—artists, publishers and authors—are in a stronger and fairer negotiating position with new and influential players like digital platforms.