Matt Levine’s Money Stuff: Fake Songs Made Real Money

Fake streams

This is roughly how Spotify works :

1. You pay $12 a month to subscribe to Spotify. In exchange, you get to listen to unlimited music from its catalogue.
2. Spotify pools your $12 with $12 each from millions of other subscribers. Let’s pretend it’s 100 million subscribers, so $1.2 billion a month.
3. Spotify takes a quarter of this money for itself, and pays the other three-quarters — $900 million in our toy example — to the musicians whose songs are on its platform.
4. Spotify divides the money up among the musicians based on how often people listen to their songs. If ...