What You Don't Know About Streaming Fraud

Pirates are kinda cool — the Hollywood version like Captain Jack Sparrow. Real pirates are actually pretty terrible. In this case, music stealing pirates that take your album re-upload it through a distributor and profit off your intellectual property. Those pirates are lame.

My friend had her album stolen and re-uploaded to a different artist profile. Ironically, the music pirate likely used the same music distributor (Distrokid) that my friend did to upload her album in the first place.

Imagine coming across an album on Spotify — you click to view it and play the first song, and then you realize, “Wait! That’s literally my song. I wrote that!” You play the next song and the next song and they are all your songs. Not cool.

Unfortunately music theft and streaming fraud are all too common. Music site Saving Country Music conducted an investigation into music piracy and fraud and found as many as 24 fake artists accounts that stole music and affected as many as 112 real artists. Read about that here.

Just from the 24 confirmed fake accounts Saving Country Music discovered, the stolen songs were receiving enough streams to generate and estimated $1,500 a week, or $75,000 a year.

What you don’t often hear is that for every illegal music upload and fraudulent stream the value of ALL music streams for EVERY artist is diminished.How’s that happen? It comes down to the system by which Spotify and most streaming services use to pay artists. Artists are paid pro rata for their streams relative to total streams generated on a given platform.

Here’s how it works:

Spotify makes a pot o’ money. Spotify takes 30% off the top of the pot. The remaining 70% is paid out to all the artists on Spotify.

You the artist are paid relative to how much you own of the total market share of streams on the platform. For example, if 50% of all the streams on Spotify in a given year were of Ed Sheeran (I would guess he actually gets closer to 1%) then Ed would get half of the pot (half of the 70% leftover after Spotify gets theirs for that year).

As total streams increase the value of a stream for everyone goes down. Fraudulent steams affect every single artist who has music on Spotify and most other streaming platforms even if it wasn’t your music that was stolen.

French music streaming service Deezer is experimenting with a new system for paying artists on their streaming platform. This other method is called the User-Centric Payment System (UCPS). UCPS would be a step in the right direction to help eliminate streaming fraud. To learn more about UCPS read about it here.

A Bulgarian Scam reportedly uploaded hundreds of 35 second tracks, added them all to playlists, and then registered 1200 premium accounts to stream the tracks 24/7. It is believed that the scammer made over $1,000,000 before the operation was discovered and shut down. This scam would have produced nearly 250 million fraudulent streams. This scam would not have worked on a User-Centric Payment System.

In another case the band Vulfpeck uploaded an album of literal silence and encouraged their fans to stream the album nonstop around the clock. The band reportedly made $20,000 off this album which Spotify ultimately removed from the platform. I am actually a fan of Vulfpeck and though I don’t agree with the tactic I commend them for trying.

Remember that as total streams on the platform increase all artists make less per stream. Every fraudulent stream takes money away from real artists and musicians.

Reports from Vulture online magazine and Music Business Worldwide say that Spotify may be paying producers upfront or negotiating a lower commission to create ambient and instrumental piano tracks and then placing those songs on massively popular playlists such as Peaceful Piano, Deep Focus, Sleep, Ambient Chill, etc… By doing so Spotify avoids having to pay real artists and content creators large streaming payout sums and consequently lowers the value of all music streams for actual blue collar artists.

It can be difficult to determine if an artist profile on Spotify is real or fake. Artists do have some control over how they their profiles are setup. Artists can add a bio, links to social media, a banner image, a profile image, and an “artist’s pick”. When artist profiles have no external links to social media, no bio, no photos of a real human, and in general no humanness or personal curation at all, then that is a bit suspicious.

This matter is particularly frustrating to me because I actually produce original instrument guitar, piano, cover song, and lo-fi music. In 2019 I produced and released 18 original instrumental tracks and not a single one has been placed on any Spotify editorial playlist. As I am writing this the top three tracks on the mega popular Peaceful Piano playlist by all appearances seem to be from fake artist profiles. Lame sauce.

Streaming fraud is a growing problem and needs to be addressed. Distributors, artists, and music streaming platforms all have a responsibility to fight against it. Artists, maybe don’t upload an album of silence. Upload art. Our money should be going to art, not a con. Distributors — implement systems that alert an artist if their music has been re-uploaded under a different account. Use waveform analysis to identify the song. Spotify for one stop pretending like their is no problem and be more responsive to artists when they raise the red flag. Show an effort that you are attempting to put systems in place that protect artists and make it more difficult for fraudsters.

I’m not saying the solution will be easy to execute, but honestly there isn’t much worth doing that is. Helping to protect artists and the value of beautiful art certainly is worth doing.