Spotify has denied claims that they pay producers to create songs using false names for premium spots on their playlists.
"We do not and have never created 'fake' artists and put them on Spotify playlists. Categorically untrue, full stop," said a Spotify spokesperson in an email to 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 allegations were brought to light earlier this week in a story published on New York magazine's Vulture site titled, "The Streaming Problem: How Spammers, Superstars, and Tech Giants Gamed the Music Industry." In the article, writer Adam K. Raymond claimed:
"Spotify is reportedly gaming the system by paying producers to produce songs that are then placed on the service's massively popular playlists under the names of unknown, nonexistent artists. 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."
Raymond cited an article from 2016 published on Music Business Worldwide. According to Raymond's article, Spotify did not initially respond to questions about the allegation. Raymond did not immediately return our request for comment.
Earlier this week, we went inside Youtube's hit making electronic music channels.