Spotify is using ghost artists to minimise royalty costs, new report claims

nme.com:

Spotify is filling listeners’ playlists with “ghost artists” to minimise royalty costs.Per Liz Pelly’s findings shared in Harper’s Magazine, popular playlists ranging from jazz and classical to lo-fi hip-hop are being padded out with material by ghost artists, effectively decreasing the amount of royalties Spotify pays genuine musicians while increasing their overall profit margins.Known as “Perfect Fit Content” (PFC), the practice was introduced to Spotify’s editors in 2017 and engineered to maximise profit by partnering with a collection of production companies, largely located outside the US.Pelly’s report noted that when the issue first came into public view earlier this year, a Spotify spokesperson claimed the allegations were “categorically untrue, full stop”, and denied the company was creating its own fake-artist tracks.NME has reached out to Spotify for a comment.“But,” she continued, “while Spotify may not have created them, it stopped short of denying that it had added them to its playlists.”The report also nodded to findings by music writer David Turner, who used analytics to show Spotify’s “Ambient Chill” playlist had been wiped of artists like Brian Eno, Bibio, and Jon Hopkins in favour of tracks from Epidemic Sound, a Swedish company that offers a subscription-based library of production music, including the kind of stock material largely used in the background of adverts and TV programmes.One former employee said of the practice: “Some of us really didn’t feel good about what was happening.

We didn’t like that it was these two guys that normally write pop songs replacing swaths of artists across the board. It’s just not fair.