The Music Business Is Finally Starting to Pay Attention to Streaming Fraud

Last year, Pandora started to get suspicious about the streaming activity of a prominent act. “This is a top artist by every measure,” George White, senior vp of music licensing at SiriusXM and Pandora, said during a panel at the Music Biz conference in Nashville on Wednesday (May 17). Some of the interest from Pandora users was clearly genuine. But at the same time, the platform picked up “abnormalities” — “lots of quick skips,” White noted, and “very unusual ratios of radio listening to premium listening” — along with “social media sites actively posting tutorials for how to game the Pandora system and teaching potential users how to drive those streams even higher.”

“This is challenging and more difficult to detect because it’s under a background of legitimate activity,” White continued. And he said that Pandora is seeing more of this type of behavior around “established artists.” 

White was one of 11 different speakers across a two-hour, three-panel fraud extravaganza — which covered a lot of ground, jumping from bot farms all the way to thieves falsely claiming publishing ownership on songs to collect money that belongs to someone else — at Music Biz. The tone stayed upbeat, though the message was glum and occasionally paranoia-inducing, with lots of talk about cybercriminals hacking into the accounts of innocent unsuspecting users for nefarious purposes. 

“We’ve been seeing lately that as technology advances, the fraud is supercharged,” said Mona Simonian, a partner at the entertainment law firm Pryor Cashman. It’s important that “people start really recognizing how much money is at stake here,” she added. And as Shuman Ghosemajumder, Google’s former “click fraud czar” (real title: head of global product for trust and safety), put it: “It’s always a little bit scary before you get your arms around the problem.”

While some panels stay general, these three sessions (an interview with Ghosemajumder about the ubiquity of fraud, “52 Flavors of Fraud,” and “Fraud Use Cases: What Can We Do?”) brought some hard numbers to a fraud conversation that often remains frustratingly diffuse, because the behavior is difficult to quantify. White had his Pandora case study. And Andrew Batey, co-founder and co-CEO of the fraud detection company Beatdapp, came armed with numerous examples and a boatload of graphs.

There was the account that recorded 33,500 plays in one week. (“The average user has a few hundred to a thousand plays a week,” Batey said.) There was the user with 96 devices “playing from 47 cities in 17 countries in the same week,” a geographical impossibility for even the most devoted jet-setter. There was the group of thousands of accounts all targeting the same songs with 155-ish plays a week, and the batch of 53,000 accounts playing around a dozen acts to camouflage the one artist whose numbers they’re actually trying to inflate. 

If this behavior continues undetected, it represents “billions [of dollars] that are being sucked out of this industry,” Batey said. This sentiment was echoed by Christine Barnum, chief revenue officer of CD Baby: Fraudsters are “diluting the pool for everyone.” (She spoke about ways for companies to improve their fraud detection capabilities on a budget, including using ChatGPT to help write programs that can detect anomalous activity.) 

Why the upbeat mood, despite the grim news? For years, many music executives, especially in the United States, were unwilling to publicly acknowledge that fraud was a problem. The fact that there was a 120-minute block — enough time to watch two episodes of Succession, quipped Beatdapp co-founder and co-CEO Morgan Hayduk — devoted to the topic at a major music business conference is indicative of an attitude shift. “I’m so happy there’s a room full of people talking about fraud,” Barnum said. 

White was similarly optimistic. While recent studies have concluded that around 80% of fraud is financially motivated — grifters running bot networks to white noise recordings, for example, rather than the work of actual artists — White said, “We’ve seen enormous strides in identifying that [activity] really early.” 

“I won’t say that’s in control; it’s an issue that requires ongoing investment,” he added. “But it’s at least something we feel like we have a handle on.”