How music distributors, bots, and streaming platforms are stopping legitimate artists from getting paid

On July 9, 2024, Devi McCallion uploaded a video titled “Help! or listen to me complain ._. (Spotify / distrokid issue).” McCallion has amassed a dedicated following and critical acclaim both as a solo artist and one-half of Black Dresses, a celebrated experimental pop project formed in 2017 with Ada Rook — the band released their final album, Laughingfish, this year. But she was out of options. The 11-minute clip came after nearly two months of seeking help from DistroKid, McCallion’s online music distributor; without telling McCallion why, in May, DistroKid had suddenly frozen tens of thousands in royalty payments earned in 2024 from streaming platforms.

McCallion had spent a month corresponding almost exclusively with A.I. chatbots, but it was only after she called out DistroKid on X in June that she got a response. In messages with McCallion shared with The FADER, DistroKid told her she was being investigated for streaming fraud, where plays of songs are artificially boosted by a system of computer programs known as “bots” or real people to juice royalty payments or give the music a false impression of popularity. McCallion denies the charge.

DistroKid said they could not discuss it further or give McCallion any additional information, including when the issue might be resolved. (Although her video identifies Spotify as the culprit, McCallion says that she was using Spotify as a catch-all for streaming services in general). “There's not a lot of transparency about who's making the claim of this streaming fraud, and no accountability,” she tells me in a video call from her stairwell. “It seemed like they were just hoping that I didn't notice the money not going to my bank account.” At the time of our conversation, she said she hadn’t heard from DistroKid since posting the video, and was starting to plan for a future without those royalties arriving at all.

Streaming royalties are the defining issue of the digital music era. Streaming now accounts for 84% of the industry's revenues, and how much artists are compensated through these platforms has an outsized impact on whether they can make a living. Currently, United Musicians and Allied Workers is demanding a penny-per-stream rate across all platforms, far above the average payout of all the major streamers.

Streaming fraud is unquestionably a serious and pressing issue. France’s National Music Centre estimates that between 2021 and 2024, streaming platforms received anywhere between 1 and 3 billion fake streams. Thanks to the pro rata model of collecting royalties favored by the biggest streaming platforms, any money paid to a fraudulent stream is money taken away from legitimate artists. It can be a lucrative scam, too, with one Danish man convicted of using a sophisticated bot network to collect 2 million Danish kroner ($290,000) from fake streams of his own songs. DistroKid uses a three-strike system when they receive complaints of streaming fraud from streaming platforms (McCallion claims she never received a single strike before her account was frozen). In April 2024, Spotify introduced new policies penalizing labels and music distributors if “flagrant artificial streaming” is detected, putting new onus on those providing the music to the platform (Apple Music rolled out similar policies in 2022).

And while how much working musicians are paid is important, McCallion’s case shows that how they are paid by music distributors is just as relevant to their survival. Unsigned artists are required to enlist a distributor like DistroKid to upload their music to most streaming platforms. McCallion doesn’t have many positive experiences with distributors, describing them as “pretty sketchy” with poor customer service. “All these companies [are] making money and handling so much money, but they act like no one's home if [need] to resolve an issue like this.”

McCallion was only informed of the streaming fraud investigation after a tweet calling out Spotify and DistroKid got some traction with her followers. It’s a privilege she’s aware few musicians have, she tells me over a video call from a stairwell, even if she was figuring out whether or not she needed to pick up shifts at Tim Horton’s. “A lot of musicians doing way more numbers than me don't have a committed audience that they could tell about the situation. They would just have to take the loss. And it's sad.”

McCallion’s case is far from unusual, but her issues are not specific to DistroKid. Krystle Delgado, founder of Delgado Entertainment Law, says she is constantly approached by musicians who are having problems getting their royalties from all kinds of music distributors and have no way of contacting them beyond a chatbot or emailed support form. Hiring an attorney is a great way to get a response, Delgado says, but the cost could absorb all of the recouped royalties, and then some.

“My general framework is that music distributors are banks,” she explains over a video call. “They let you distribute your music to the music platforms, they get paid the royalties, then they pay you the royalties. And what I have seen happen over and over is there seems to be this unspoken business model of the distributors withholding royalties from artists because they get these claims.”

On her YouTube page, Delgado breaks down the contracts of different music distributors line-by-line, pointing out problematic sections. DistroKid has one of the better ones, she tells me, and is usually more amenable to releasing royalties once she contacts them. But as a whole, the music distribution system is burdened by a lack of logic.

“If you don't like me using your platform because I'm getting claims of copyright infringement,” Delgado says, “if it's causing time and effort for your legal team, fine. Kick me off the platform. But when it comes to the royalties, especially if it's a claim that [an artist] made $60,000 by defrauding Spotify, [the distributor] is gonna keep it? Shouldn't the answer be no, we're sending the money back to Spotify?”

Around 2.17 million tracks were uploaded to streaming services per month in 2023, all of them requiring a music distributor. Distributors may advertise excellent customer service, but in reality, they just can’t keep up with the volume. Delgado encourages musicians to use streaming services as marketing tools rather than primary sources of income, and build financially stable careers around other sources of revenue: “We still are looking at what we call ancillary income: Are we licensing your music to TV and film? Are we getting you to do one-off shows, one-off runs of merchandise? Are we building your brand by really focusing on your social media? Those are the conversations that are way more important.”

Streaming fraud is a fraught topic within the music industry. Artists, especially within hip-hop, regularly focus on it: Russ has alleged that major labels will regularly spend tens of thousands on fake streams for their artists who already have a built-in audience. And if a musician like Drake is losing a prominent rap beef, they can just insinuate that their rival has purchased fake streams.

Struggling artists may see fake streams as one of the only ways to get noticed in a rapidly changing industry. Eric Drott, Associate Professor of Theory at the University of Texas at Austin, said in 2021 fake streams can potentially get the attention of popular playlist curators by simulating viral popularity. Getting placed on these playlists can be a game-changer for small artists, but platforms like Spotify are cracking down, announcing investments into detecting fake streams and pledging to pour resources into separating the real artists from the fake ones who buy their way into listeners’ headphones.

The truth is more complicated. It is not difficult to purchase botted streams for someone who has no idea of it happening. Certain companies can also place songs by unknowing artists on playlists and pump in the botted streams; in theory, this acts as a kind of promo, so artists will see the spike in their stats, check out the playlist, and consider buying more botted streams from the provider. What can actually happen is the artist gets penalized for botted streams purchased against their will. The problem has been going on for years, and by some accounts has only gotten worse.

The consequences can be even more severe than withheld royalties. Benn Jordan, a musician who records under the alias The Flashbulb, found himself flooded with texts one day in February 2024 asking him why his music was suddenly unavailable to stream. After sending several emails to his music distributor, TuneCore, he was finally told that “abnormal streaming activity” had been detected on “one or more” of his releases. Like McCallion’s, Jordan’s fanbase flooded his distributor with demands for a response on social media; TuneCore restored the music after a few days and said in a statement that an internal error caused the music to be removed before Jordan was notified (Jordan, for his part, claimed he did not see any strange activity on his Spotify activity).

Soon after restoring his music, TuneCore agreed to meet with Jordan “about developing a system for this type of thing that advocates for their customers rather than adhering to a zero-tolerance policy.” It’s something Jordan believes is vital at all levels. "The situation motivates an immediate change of policy with both Spotify and digital distributors that prevents this from happening in the first place," Jordan told Ars Technica. "If you're an independent musician using one of these services, this situation should scare the shit out of you."

At best, it seems that the platforms don’t view false botting claims against artists as especially significant. The penalties for fake streams Spotify introduced in April add penalties rather than solutions and place the responsibility squarely on the artist, even when the platform has more control: The “All you need to know about artificial streaming” information section on the Spotify website offers little recourse for artists being artificially streamed against their will; such unfortunate cases, which Spotify claims are a “small minority of total artificial streaming activity,” may “hopefully” be resolved by working with one’s label and/or distributor.

For McCallion, dealing with what she described as DistroKid’s “buggy automated systems” left her feeling defeated. However, hours after I reached out for comment from DistroKid, the company sent McCallion an email announcing that the investigation had been concluded. McCallion was able to withdraw the funds into her bank account.

“It is such a relief,” McCallion says in an email the morning after receiving the news. “I am really happy to be able to have my own money. I am really excited to be able to work on actual music again and hopefully continue to get the money I earn from it.”

While her story has a happy ending, it doesn’t undo the uncertainty of the past few months. “The stress was definitely adding up. The effect of losing out on more than half a year of being paid would have been pretty bad. As a musician, there's no promise of being popular forever and with Black Dresses ending and all that... It's possible I won't be making the same type of money in the future so I was sort of counting on that money to help patch me over to where I'm going next.”

The incident has taught McCallion not to rely on getting paid from money earned on streaming. “I'm going to do better to make sure I can't get backed into a corner like this again, have different income streams,” she writes. “It's just hard to prioritize that stuff when I have limited energy and I'm doing everything by myself.”

The sudden change of events was the first time McCallion felt a sense of urgency from either DistroKid or the streaming platforms to get the money that belonged to her in her hands. She recalls a separate incident where she reported accounts to Spotify who were illegally uploading her old music and collecting “hundreds or thousands of dollars” in payments. “When I did that report,” she says, “they didn't ask me, ‘where can we pay you?’” That money is gone, McCallion says, her voice laced with the bitterness of someone tired of asking for what belongs to them.