Music Streaming vs. Terrestrial Radio: Which Pays Better?

By Andre Owens, Madwax Records February 22, 2026 Music Streaming vs. Terrestrial Radio: Which Pays Better?

Hey there, fellow music lovers! If you’ve ever wondered how your favorite songs actually put money in the pockets of the artists, you’re not alone. Today, we’re diving into one of the hottest debates in the music world: music streaming versus terrestrial radio—which one truly pays better for the artists behind the tunes?

Let’s set the stage first. Streaming platforms like Spotify, Apple Music, and Amazon Music have transformed how we consume music over the past decade. Meanwhile, terrestrial radio, the classic FM/AM stations many grew up with, still holds strong sway in many communities and markets. But when it comes to compensation, the two worlds play by different rules.

The Streaming Model: Dollars Drop by Drops

Streaming pays artists based on “per-stream” royalties, which often sound promising but can be surprisingly modest. On average, one stream might earn an artist between $0.003 and $0.005—that means you’d need hundreds, if not thousands, of streams to hit a decent payout. Why is it so low? Because the revenue pie is split between the platform, record labels, publishers, and finally the artists themselves. Even the biggest stars feel the crunch unless they rack up billions of plays.

The upside? Streaming offers incredible global reach and ongoing revenue. One viral hit on playlists or social media can explode overnight, and even older catalogs get new life as listeners discover or revisit songs. Plus, platforms often create curated playlists, personalized recommendations, and endless variety, giving artists the chance to reach new ears without geographical limits.

Terrestrial Radio: The Classic Giant With Its Own Rules

Terrestrial radio pays artists differently, primarily through performance royalties collected by organizations like ASCAP, BMI, or SESAC in the US. These royalties are generated from radio stations’ licensing fees and advertising revenues, which are then distributed based on how often a song is played. Unlike streaming, listeners don’t pay directly for the music—advertisers foot the bill, and that money helps fund those royalty payments.

A key advantage of terrestrial radio is its scale and influence. A single radio station can reach millions during peak hours, and songs placed on heavy rotation get significant exposure. However, payment tends to favor more established acts with strong airplay histories. Emerging artists might find it challenging to break into the rotation without label support or promotion.

Which One Really Pays Better?

Short answer: It depends. Streaming offers volume and can pay off handsomely if your music gains massive traction across platforms. Terrestrial radio, meanwhile, delivers steady royalties for high-rotation songs and can introduce artists to broader or local audiences with deeper engagement. But if you’re an up-and-coming artist, streaming’s democratized access might offer more opportunity to get heard—albeit potentially with slower financial returns initially.

Here’s a little industry tidbit: many artists combine both. They use radio airplay to boost their profile and capitalize on streaming’s vast, on-demand audience for continuous plays. It’s rarely an either/or game but more of a strategic mix.

For Listeners: Why It Matters

Understanding how these systems work changes how we appreciate music consumption. Do you binge on playlists? Your streams support artists in a specific way, encouraging platforms to curate and invest in diverse genres. Still love tuning in to your favorite local FM station? Your engagement there backs the traditional ecosystem that has supported artists for decades.

So next time you press play or dial in, remember you’re part of a complex web that shapes artists’ livelihoods. Sharing music, buying merch, attending shows, and yes, even advocating for fair royalty policies—all make a difference beyond just the song itself.

Thanks for hanging out today and unpacking this fascinating crossroads where old meets new in the music world. Next week, we’ll explore emerging trends in artist-first platforms and what they might mean for how we discover and support music in the future. Until then, keep listening—and keep the music alive!