Analysts Report Up to 10 Percent of Music Streams Are Fake

September 26

  Around 10 percent of music streams may potentially be fraudulent, according to a recent report that delves into the state of the streaming industry. The report, written by Anna Nicolaou for The Financial Times, primarily explores Universal Music Group (UMG) and Deezer's "artist-centric music streaming model." UMG and Deezer intend to introduce this new model, targeting "professional artists" with at least 1,000 monthly streams, initially in France later this year.

A significant concern in this collaboration is the presence of what UMG labels as "non-artist noise content" and a deluge of uploads that lack meaningful engagement on music streaming platforms. The idea behind the proposed model is to discourage such uploads in the future.

JPMorgan analysts, cited in the FT piece, provide examples of individuals attempting to manipulate the system favored by Spotify and other major streaming platforms. Executives estimate that as much as 10 percent of all music streams could be "fake," originating from so-called "streaming farms."

The use of such deceptive tactics has been a prominent industry issue for years, with artists frequently voicing their concerns. In 2019, reports indicated that artists and labels might have lost hundreds of millions of dollars due to fake streams. Fast forward two years, and Pigeons & Planes conducted an in-depth examination of the significance of identifying counterfeit data in the industry, including key indicators for distinguishing between genuine and fraudulent streams.

Taking a broader perspective, an ongoing concern within the streaming era, especially concerning Spotify, has been the matter of royalties. For instance, amid the coverage of the WGA writers' strike, Snoop Dogg voiced his support and drew parallels between the streaming industry and the challenges faced by artists.

Snoop questioned the compensation model, expressing bewilderment about how artists could amass a billion streams yet receive less than a million dollars. This financial disparity has been a major point of contention among artists, who often feel that despite achieving substantial streaming numbers, their earnings do not align with their success.

As a response to these issues, some artists have chosen to bypass the traditional streaming model altogether. Instead, they opt to release their music independently through direct-to-fan platforms, seeking greater control and fair compensation for their creative work.