The true cost of streaming fraud: Artists’ revenues hurt
Image credit: Kenny Eliason
Music streaming fraud takes valuable revenues out of the pockets of artists and the true cost of it may shock you.
A music data tracking firm has revealed a shocking new figure as to how much streaming fraud may be costing the industry. The figure reveals how much this damaging act is hurting the earnings of hundreds-of-thousands of genuine artists.
Beatdapp Software found in their analysis that around $2 billion in streaming royalties is taken by streaming fraud each year. The company says they are a “leading authority in fraud detection” and their report shines a light on how harmful the practice is.
Beatdapp CEOs Andrew Batey and Morgan Hayduk told Sky News: “No on notices that a few pennies are going to this song and a few pennies are going that song but, in aggregate, they can steal billions of dollars.”
Fraud streaming can take a number of forms, but is essentially the practice of artificially streaming a song so that it generates revenue. As streaming services provide artists with revenues based on their number of plays, some bad actors attempt to take advantage of this by artificially boosting streams.
This damages the potential of legitimate artists making a living from their work on streaming services. As Batey and Hayduk say: “That money would have gone to real artists that would have been used to pay out managers and agents and lawyers, labels, distributors. But instead it’s syphoned off and it goes to professional scammers who are just stealing from the industry.”
How the industry is tackling fraud streaming
Big players like Deezer and Spotify have made moves to tackle the issue of fraud. Both streaming services have promised extra efforts to remove and punish fraud streaming, with an emphasis on remunerating legitimate artists with the regained revenues.
Spotify’s new artificial streaming policy fines distributors and labels found to play host to artists artificially streaming their tracks. At RouteNote, we are working closely with streaming services including Spotify to help stamp out this bad practice for the benefit of legitimate artists.
Spotify’s new policy will not affect legitimate artists working with RouteNote. The charges made by Spotify will not come out of the overall pot, therefore protecting artists revenues.
As the industry does more to prevent the potentially $2 billion in lost revenues from streaming fraud, artists should see their own earnings rise.