This week Spotify has been forced to defend their business practices after a Vulture report accused the streaming service of gaming their own system for profit. That Vulture piece, titled “The Streaming Problem: How Spammers, Superstars, and Tech Giants Gamed the Music Industry," citing info that had been published more than a year ago, alleged that Spotify was paying producers to generate dough for them by coming up with songs under fake names to post onto premium playlists.
As pointed out by Billboard, the article states that "This upfront payment saves the company from writing fat streaming checks that come with that plum playlist placement, but tricks listeners into thinking the artists actually exist and limits the opportunities for real music-makers to make money."
Other tactics highlighted in the article contend that people try to make money off the service by doing crap like misspelling artists' names, or throwing together terribly customized playlists (like 100s of versions of "Happy Birthday").
Now, after having a few days to formulate a response to the accusations,Spotify has denied the claims in no uncertain terms. "We do not and have never created 'fake' artists and put them on Spotify playlists. Categorically untrue, full stop," a spokesman for the company told Billboard. "We pay royalties -- sound and publishing -- for all tracks on Spotify, and for everything we playlist. We do not own rights, we’re not a label, all our music is licensed from rightsholders and we pay them -- we don’t pay ourselves."
The spokesman also went on to comment on users who willingly choose to game the system, saying "As we grow there will always be people who try to game the system. We have a team in place to constantly monitor the service to flag any activity that could be seen as fraudulent or misleading to our users."
If you want to read the full Vulture piece you can find it right here.
