Fees & Penalties for Artificial Streaming

Store platforms like Spotify, Apple Music, YouTube, and others, are beginning to penalize fraudulent activity on their platforms in an effort to discourage artists from committing streaming fraud.

Beginning in April 2024 Spotify will charge a monthly €10 penalty to labels and distributors for each track deemed to have high levels of artificial streaming activity.  This fee will be passed to the account holder by Tunetradr Records by charging account balance and/or the payment method on file in your account in your local currency. You will also receive an invoice and an email notification to your account’s primary email address letting you know which tracks were impacted. 

In addition to the fee, Spotify may remove artificial streams from your official sales reports and listener-facing play counts, even if they still appear in your Spotify for Artists profile.

What is Streaming Fraud?

Streaming Fraud (also known as artificial streaming, streaming manipulation, abnormal store-end behavior, fraudulent store-end behavior, or store-end fraud) is the act of artificially inflating your views, streams, follows, and sales, in order to generate revenue or manipulate your release’s popularity in the charts, on playlists, or in search results. This is typically the result of employing a promotion or playlisting company that guarantees to get you more streams, follows, downloads, favorable playlist placement, or overall increased exposure on streaming platforms.  It also encompasses the use of scripts, bots, or other automated systems to interact with your release.

It’s important that you carefully research any promotion company that promises or guarantees that it can get you streams, followers, or playlist placements.  In many instances, their tactics may violate Spotify’s terms & conditions.  Spotify breaks down the details in their artificial streaming educational hub, and you can find the full list of activities that aren’t permitted under any circumstances in their User Guidelines.

Why does identifying and addressing fraudulent streams matter?

When artists use strategies that artificially inflate their play counts, revenue from the royalty pool is redirected from artists who earned legitimate streams to those who didn’t.  This dilutes the value of each stream, which ultimately means that you earn less money.

Additionally, attempting to manipulate the algorithm to gain favorable placements in radio, auto-play, search results, chart performance, or other short-term benefits you might see can get you blocked from future editorial or other partnership opportunities, you can be penalized by the platform where the fraudulent activity was found, your music may be permanently taken down, and you can be blocked from all future distribution attempts.

What happens to my music if I receive a penalty notice?

Tracks that have high percentages of fraudulent streams will be removed from all streaming and download platforms. You will not be able to reupload or redistribute tracks that have been removed due to artificial streaming.  Depending on how much fraudulent streaming activity has been identified across your account, your Tunetradr Records account may be completely shut down.

I didn't pay for streams, why am I being charged a penalty?

If you have received a penalty notice, Spotify’s fraud team has identified a high number of artificial plays. According to Spotify's blog post on modernizing their royalty system:

Spotify invests heavily in detecting, preventing, and removing the royalty impact of artificial streaming. This new deterrent follows improved artificial streaming detection technology we rolled out earlier this year, as well as the establishment of the newly formed Music Fights Fraud Alliance.

Using a sophisticated, proprietary method for identifying fraudulent streams on their platform, Spotify then shares the identified tracks back to distributors, labels, and other content providers.  At that time they are also charging those providers a €10 per-track fee, which will be passed on to the Tunetradr Records account holder in their local currency.

Is the €10 penalty a one-time fee?

It is possible for you to be penalized more than once, and therefore you may be responsible for multiple fees over time.  Penalties will be charged a €10 fee on a per-track-per-month basis - so if you have 1 track that appears in Spotify’s fraud report once, you will be charged €10 once for that track.  If you have 5 tracks that all appear in the fraud report in the same month, you will be charged €10 per track - or €50 for that month.

Whereas, if you have a track that appears in the fraud report across multiple months, you will receive the €10 fee each month it is identified.