Spotify has recently come under fire for year-old controversies, this time addressing the claims with an official statement. In response to allegations that the streaming platform paid artists to create royalty-free music to pad its playlists, a spokesperson minced no words in his on-the-record denial.
“We do not and have never created ‘fake’ artists and put them on Spotify playlists,” read the spokesperson’s email to Billboard. “Categorically untrue, full stop.”
While not directly refuting accusations that the company had created fake artists, the spokesperson said that Spotify paid royalties on all of its songs, including those on playlists. “We do not own rights, we’re not a label, all our music is licensed from rightsholders and we pay them,” the email continued. We don’t pay ourselves.”
Spotify remained silent last year when the original claims surfaced in a Music Business Worldwide article. Only when The Vulture cited the now dated piece in their own feature – of which the fake artist speculations only served as a supporting detail – did the streaming service’s management elect to get in front of the issue. Music Business Worldwide promptly returned fire with a list of artists whose music is only featured on Spotify and nowhere else.
In Search of Solvency
Even though Spotify’s “freemium” business model positioned it better than platforms like SoundCloud, its break even point remains no closer on the horizon. From 2014-2016 the former company’s losses grew by 64% to $340 million. Even as their team finds new ways to capitalize on the service, in the the long term its fate remains dubious.
SoundCloud also finds itself mired in recent controversy as the company just announced that it would cut 40% of its staff.
Source: Your EDM
