Streaming platforms are paying out exorbitant sums of money to bad actors, according to research from Beatdapp, which revealed that around 10% of all music streams are fraudulent.
This is according to a recent report by News from heavenwhich yielded worrying figures from the music data tracking company. Currently, all subscription money is placed into a large pool that is used to pay artists for each stream. This model has reportedly been exploited by scammers, whose methodology typically involves uploading a song and then deploying bots to play it en masse before collecting royalties on the artificial streams.
According to Beatdapp, this fraudulent activity has generated revenues of up to $3 billion a year. The company has joined forces with Beatport in hopes of expanding its fraud detection technology to ensure that streams on the platform are authentic.
The benefits to the company are very clear: by detecting fraud, they won’t lose money paying for inauthentic content. However, Beatport’s charts open the door to benefits for non-artist users on the platform. By removing fraudulent streams, Beatport’s chart rankings will give users a better idea of who’s trending organically in the industry through a “fair and transparent environment” free from the influence of pay-to-win bots.
Beatport's chief revenue officer Helen Sartory acknowledged that fraud is less of an issue on its platform compared to Spotify or Apple Music, but doubled down on these benefits.
“We launched streaming products under the Beatport and Beatsource brands in 2019, and while they have not historically been a target for streaming fraud, suspicious activity has been on the rise in recent months,” Sartory said in a statement. “While our fraud rates remain half the industry average, we rely on accurate streaming data not only to preserve fair compensation for artists and labels, but also for song recommendations and analytics. We’re excited to be working with Beatdapp to ensure our data is representative of authentic listener engagement.”
You can learn more about Beatdapp's fraud detection technology here.
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