How Much Money Does Taylor Swift Make From Spotify

Singer Taylor Swift, seen performing on ABC's "Good Morning America" to promote her new album "1989" in New York on Oct. 30, recently pulled all of her albums from Spotify.

Taylor Swift's Spotify payout turns out to be much less than the streaming service led people to believe earlier this week.

Time Magazine reports that Swift's label earned $2 million from streaming her songs over the past year.

That's the global figure Spotify gave Time — but Swift's record label said the domestic streaming payout from the past year was much lower at $500,000.

In comparison, Swift's new album "1989" is expected to net about $12 million in gross sales in its first week.

The $2 million figure is also significantly less than the $6 million Spotify CEO Daniel Ek said top artists would pull in over the next year.

Spotify factored its growth projections into that number, but it still seems a bit far-fetched considering that Swift's label earned only $2 million in the past year from streaming.

And that figure doesn't appear to be the amount Swift personally earned for the streaming rights — it's just the amount that Spotify paid to the label that owns the rights to Swift's music.

Swift has become the center of a discussion over whether Spotify pays artists enough for the rights to stream their music.

This issue of artist pay resurfaced last week when Taylor Swift pulled her entire catalogue of music from Spotify after refusing to put her new hit album "1989" on the service. Swift has said that artists need to protect their work and value it appropriately.

Part of the problem artists face is that the amount of money Spotify pays labels is greater than what the artists see from allowing their music to be streamed.

Last month, Jimmy Buffett complained that artists who streamed their music on Spotify are "at the end of the pipeline" when it comes to the money Spotify pays labels for permission to stream albums. And the money Spotify pays labels, while totaling a reported 70% of the company's revenue, averages less than a penny per play.

Jonathan Price, Spotify's global head of communications and public policy, defended the $2 million figure to Time: "Our users, both free and paid, have grown by more than 50 percent in the last year, which means that the run rate for artists of every level of popularity keeps climbing. And Taylor just put out a great record, so her popularity has grown too. We paid Taylor's label and publisher roughly half a million dollars in the month before she took her catalog down — without even having '1989' on our service — and that was only going to go up."

Borchetta doesn't believe that Spotify is a boon to the industry.

"The facts show that the music industry was much better off before Spotify hit these shores," Borchetta said. "Don't forget this is for the most successful artist in music today. What about the rest of the artists out there struggling to make a career? Over the last year, what Spotify has paid is the equivalent of less than 50,000 albums sold."

About 25% of Spotify's 50 million active users pay for the service. Spotify premium subscribers pay about $120 per year for the service.