Artificial streaming
Spotify invests heavily in detecting, preventing, and removing the royalty impact of artificial streaming. Here’s some information on what Spotify is doing:
3rd-party promotional services advertising streams in return for payment violate Spotify’s terms & conditions. Using them could result in your music being removed from Spotify. As a consequence Spotify will remove confirmed artificial streams from your data before your Spotify for Artists dashboard refreshes; in other cases, you may still see artificial streaming spikes in your Spotify for Artists data, even though associated royalties may be withheld.
Spotify also reserves the right to remove manipulated content from the platform in the case of repeated or egregious artificial streaming. Spotify will share monthly reports with labels and distributors about confirmed artificial streaming on our platform. Based on those reports, distributors may take actions like issuing warnings or, in flagrant or repeated cases, removing your content from streaming services or suspending your account.
Fraud Alliance – This new deterrent follows improved artificial streaming detection technology rolled out earlier this year, as well as the newly formed Music Fights Fraud Alliance. Read more
From April 1, 2024 Spotify will charge labels and distributors per track when flagrant artificial streaming is detected on their content. (This charge is only applied for very high rates of artificial streaming per track.). Please note, that this fine will be passed on to the issuing label only, this will not affect any other clients. We will pass information on to our labels when we know more about this.
Read more here on artificial streaming.
Enhancing Artist Payments: Addressing Lost Revenue in the System
In the vast catalog of over 100 million tracks on Spotify, tens of millions have been streamed between 1 and 1,000 times in the past year, generating an average of $0.03 per month. However, due to the minimum withdrawal requirements set by labels and distributors (typically $2-$50 per withdrawal) and associated bank transaction fees (ranging from $1-$20 per withdrawal), these small earnings often fail to reach the rightful uploaders. Consequently, these overlooked payments collectively amount to $40 million annually, which could significantly augment the earnings of artists who heavily rely on streaming revenue.
Starting from April 1st, tracks must accumulate a minimum of 1,000 streams within the preceding 12 months to qualify for recorded royalties. This adjustment aims to ensure that Spotify’s revenue model remains unchanged, with the size of the music royalty pool distributed to rights holders remaining consistent. However, instead of dispersing funds in fractional $0.03 payments, tens of millions of dollars will be redirected towards increasing payments to all eligible tracks. Notably, 99.5% of all streams originate from tracks meeting the 1,000 annual streams threshold, ensuring that each of these tracks benefits from this policy adjustment.
This strategic reallocation of funds serves to amplify payments for artists who heavily rely on streaming revenue, redirecting resources from minuscule payments that often fail to surpass distributors’ minimum payout thresholds. Moreover, this policy revision eliminates a tactic employed to manipulate the system or conceal artificial streaming, as uploaders will no longer be able to generate nominal earnings from an excessive volume of tracks.
For further insights into this policy adjustment, please refer to the Spotify for Artists help center.
Additionally, we encourage you to explore Spotify’s tools and resources.
