How free music distributors make money
Delivering music, processing store reports, paying out and answering support all cost money. A distributor with no fee covers those costs in other ways, usually one or more of these:
- A share of your royalties. The service keeps a percentage of what the stores pay, for as long as your music is with it.
- Paid upgrades. Faster delivery, more stores, your own label name or better support sit on a paid tier.
- Paid extras. YouTube Content ID, royalty splits or other tools are sold separately, per release or per year.
- Fees on the way out. Charges to withdraw your money, to change a live release or to take it down.
Withdrawal costs are common across the industry, not only at free services. Spotify itself notes that distributors typically charge $1 to $20 per withdrawal and set minimum withdrawals of $2 to $50 (Spotify for Artists).
None of these is wrong in itself. What matters is what they add up to for your music.
The maths: a share of royalties against a yearly fee
A percentage costs little when your music earns little, and a lot when it earns a lot. A fixed yearly fee works the other way round. The table compares the two with round numbers. They are examples only, not any real service's prices.
We use yearly earnings rather than streams, because no store pays a fixed amount per stream. See how much Spotify pays per stream.
| Store royalties in a year | Example A: no fee, keeps 15% | Example B: $25 a year, keeps 0% |
|---|---|---|
| $50 | Costs you $7.50 | Costs you $25 |
| $150 | Costs you $22.50 | Costs you $25 |
| $500 | Costs you $75 | Costs you $25 |
| $2,000 | Costs you $300 | Costs you $25 |
| $10,000 | Costs you $1,500 | Costs you $25 |
In this example the two cost the same at about $167 a year in royalties, which is $25 divided by 15%. Below that, the free service is cheaper. Above it, the yearly fee is cheaper, and the gap grows with every stream.
Yearly fee ÷ the percentage the free service keeps = the yearly royalties at which both cost the same. Run it with the real prices you are comparing. And remember that the percentage is taken every year your music stays with the service, not only the first.
What else to check before you choose
The headline price is only part of it. Ask every service, free or paid:
- Is YouTube Content ID included or an extra, and what share of it is kept?
- Are ISRC and UPC codes free?
- What does it cost to withdraw, and what is the minimum withdrawal?
- What happens to your releases if you stop paying, or stop using the service?
- Can you take a release down, or move it to another distributor, without a fee?
- Who answers when something goes wrong, and how quickly?
When free distribution makes sense
- You are releasing your first songs and do not yet know whether anyone will listen
- Your music earns less in a year than the break-even point for the prices you are comparing
- You release rarely and do not want a yearly bill
- You have a large catalogue and a deal where the share pays for real work: marketing, an account manager, a team
Free makes less sense once your music earns steadily. From that point a percentage usually costs more than a fee, and it keeps costing more every year.
Where TempoDigital stands
TempoDigital is not free for independent artists, and we would rather say so plainly. These are our plans:
| Plan | What you pay | Our share of store royalties |
|---|---|---|
| Release | $8.99 per release | 10% — you keep 90% |
| Artist | $29.99 a year, unlimited releases for one artist | None — you keep 100% |
| Label | $149 a year, up to 10 artists | None — you keep 100% |
| Label Partner | No fee | 15% — you keep 85% |
The only plan with no fee is Label Partner, a revenue share for larger catalogues that comes with marketing support and a dedicated account manager. It is agreed with us rather than bought online, so talk to us if your catalogue fits.
If a yearly plan lapses, nothing is taken down: releases already in the stores stay there, and only new deliveries wait until you renew. You can withdraw once your balance is above $70; below that it carries over. Compare the details on pricing, or see how we compare with DistroKid and TuneCore.