Spotify is in hot water over allegations that it is creating fake artist accounts and placing songs by those artists in premium playlists. The service is denying it, but when you look at some of these accounts, things start to look fishy. Many don’t have any online presence outside of Spotify, so how are they racking up millions of plays on Spotify.
Spotify denies the allegations a statement via Billboard, “We do not and have never created 'fake' artists and put them on Spotify playlists. Categorically untrue, full stop,” a Spotify spokesperson wrote in an email. “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.”
However, it would appear as though Spotify has been caught red handed. Music Business Worldwide did a follow up and some of the artists they dug up have no online presence, but have names that are similar to popular ones today. One example is Bon Vie, a profile with two ambient songs. There is no mention of those songs anywhere else nor can you buy them on iTunes.
This may seem like an insulated problem, but it could become a bigger issue for Spotify. At the very least it is very unethical and misleading for Spotify to commission these songs and then create these fake artist profiles. It is taking up slots on these playlists from other real acts that could have used the exposure, thus creating more demand for pluggers and the company. By keeping everything in house, the royalty payment process would be essentially eliminated and they could generate more money. This could be tantamount to fraud if it is proven they are putting out music under false pretense for monetary gain.
This story likely isn’t over so stay tuned for more updates.