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Business News Digital Labels & Publishers Legal
Music distributors ally to fight streaming fraud
By Chris Cooke | Published on Thursday 15 June 2023
A number of music distributors have come together with Spotify and Amazon Music to form Music Fights Fraud, a new initiative described as “a global task force aimed at eradicating streaming fraud”.
It’s no secret that there are scammers who upload content to the streaming services with the aim of fraudulently pulling money out of the digital royalty pool each month.
Some aim to get legitimate streams for misleadingly labelled or copyright-infringing content. Others set machines listening to the music they upload via their own premium accounts, with the current streaming business model allowing them to pull out more in royalties than they spend on subscriptions.
These scams have been common knowledge for years, with some in the industry consistently vocal about the need to tackle the fraud. Others were somewhat suspiciously quiet about it all for quite some time. However, in the last year calls for action have been increasing, including from the majors, in part because the scale of the fraud is both increasing and becoming ever more apparent.
Changing the business model – for example to a user-centric system – would stop some of the fraud. But in the meantime, it’s generally agreed that one of the problems is the lack of coordinated action between the streaming services and music distributors. Each company has its own system in place to spot and stop scammers, but a lack of communication across the industry allows the fraudsters to keep jumping from one distributor to another.
Music Fights Fraud will seemingly seek to address that weakness. The companies involved in the initiative say that the scheme “represents the first time all corners of the music industry have aligned as a united front to combat fraud in music streaming”.
It “will focus on streaming fraud and streaming manipulation across digital streaming services and will work to ensure that the global music streaming market is fair and that all members actively contribute to solutions intended to balance the equity of its operations”. The objectives of Music Fights Fraud are to “detect, prevent [and] mitigate” fraud and “to enforce anti-fraud measures, thereby moving closer to an industry where fraud has no place”.
Participating distributors include CD Baby and its parent company Downtown, TuneCore and its parent company Believe, DistroKid, UnitedMasters, Symphonic and Empire. The initiative will also be supported by the National Cyber-Forensics And Training Alliance, a US-based organisation that aims to “provide a neutral, trusted environment enabling multi-party collaboration to identify, mitigate and disrupt cybercrime”.
Confirming its participation in the programme, CD Baby’s Chief Revenue Officer Christine Barnum says: “For 25 years, CD Baby has been committed to offering access for independent musicians and songwriters to grow their careers. As streaming has grown and dominated our industry the opportunities for bad actors to take advantage of the fragmentation has grown as well”.
“I am proud”, the goes on, “for CD Baby to be a founding member of Music Fights Fraud and for us to join forces to build a united and comprehensive solution to ensure all music creators are being compensated, with royalties generated making it to the right hands”.
TuneCore boss Andreea Gleeson adds: “Streaming fraud is a costly issue, with bad actors diluting the royalty pool and taking money out of the pockets of legitimate music creators. This has a great impact on self-releasing artists, who account for 5.7% of the world’s streams and represent the fastest-growing sector of the global music industry, with over 6.4 million artists”.
“TuneCore is proud”, she continues, “to join other leading digital music distributors and [streaming services] to, for the first time ever, pool our resources and stand together to fight streaming fraud and create a fairer, more equitable streaming landscape for creators”.
The scheme has been welcomed by a number of music industry trade organisations.
Mitch Glazier, CEO of the Recording Industry Association Of America, says: “Music creators, distributors and services all have a shared stake in a healthy, reliable streaming economy that values human artistry, protects creators’ rights and supports authentic streams. RIAA supports new innovations in the fight against all forms of stream manipulation, fraud and piracy, and welcomes the efforts of Music Fights Fraud”.
Meanwhile, in the UK, Silvia Montello, CEO of the Association Of Independent Music, adds: “Streaming fraud, in all its guises, is recognised as one of the biggest – and growing – issues facing the recordings business. AIM welcomes all initiatives from distributors, platforms and labels to help tackle it effectively”.
“The Music Fights Fraud alliance, which seeks to identify fraudsters, prevent ‘distributor hopping’ tactics and enable fraud investigation for criminals operating at scale, can only be a step in the right direction”, she goes on. “AIM encourages this and other initiatives using technology to assist in the gatekeeping of content uploads so that genuine artists and creators receive the royalties due to them”.
