Transparency In The Streaming Age

Canadian rapper Aubrey “Drake” Graham filed a series of lawsuits against Universal Music Group, owner of his label Republic Records, bringing to light major issues unfolding behind the scenes in the music industry.

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Amid his highly publicized rap battle with Kendrick Lamar, Drake filed a series of lawsuits aimed at Universal Music Group, owner of his label Republic Records. Among other allegations, Drake accuses UMG of manipulating streams to favor Lamar’s tracks over his own, causing him financial harm. These are just allegations for now, but they open the door to broader conversations about how major labels leverage their relationships with streaming platforms.

These aren’t niche issues: global paid streaming subscribers are projected to reach 827 million in 2025, according to research by Goldman Sachs. With that kind of scale, small shifts in visibility or recommendation algorithms can have enormous financial implications.

Bots, Algorithms, and Playlist Visibility

A significant issue at the heart of this lawsuit and the industry as a whole is the lack of regulation of “bots,” software accounts that are programmed to repeatedly stream a song or album and, in the process, inflate streams. A Financial Times article found that as much as 10 percent of all music streams are derived from bots or streaming farms.

According to allegations in Drake’s lawsuit, “Kendrick Lamar’s ‘label’ (i.e., Interscope) paid him via third parties to use ‘bots’ to achieve 30,000,000 streams on Spotify in the initial days following the Recording’s release with the goal of ‘jumpstarting’ its spread and turning it into ‘a crazy hit’ on the platform.” The lawsuit further stresses Spotify’s failure to prevent the issue, as the platform itself acknowledged the presence of bots in response to Drake’s pre-litigation filing in New York State court.

The issue goes far beyond play counts, exposing systemic flaws in algorithms and playlist placements that serve as the industry’s real digital gatekeepers for artist exposure. In 2020, the Federal Trade Commission scrutinized promotional practices in the streaming era, examining how labels influence playlist placement and algorithmic recommendations.

Streaming was supposed to remove gatekeepers, but playlist algorithms have instead created new ones. It’s hard enough for many of them to break into a platform’s curated playlist, let alone reach the level of clout necessary to access customized licensing terms with that platform. Even well-established artists struggle to break through without curated playlist placement, let alone access to preferential licensing terms with DSPs. Streaming has reshaped music promotion, concentrating leverage around algorithms and data feeds. That shift affects everyone from bedroom producers to stadium headliners.

Among Drake’s other allegations, he claims UMG charged “…Spotify lower than usual licensing rates for the Recording in exchange for Spotify affirmatively recommending the Recording to users who are searching for other unrelated songs and artists,” and that UMG partnered with Apple’s Siri to play Kendrick’s track unprompted in response to unrelated voice requests.

Tom Gray, founder of the #BrokenRecord campaign, echoed this sentiment in his testimony to the UK Parliament’s Digital, Culture, Media and Sport Committee, stating: “The reality is that playlisting is the new payola. The gatekeepers have changed, but the game remains the same.”

Without major label backing, independent artists face an uphill battle. Playlist inclusion can feel like a lottery, and without it, algorithmic momentum is hard to build. That cycle of fewer playlists, less visibility and lower per-stream rates makes it tough to break through, even for artists with strong followings or touring chops.

This isn’t just a visibility issue; it’s an economic one. Goldman’s reporting shows that recorded music revenue growth has slowed dramatically, missing 2024 projections by over 4 percentage points. When top-line growth slows, competition over playlist slots and per-stream payouts only intensifies.

Metrics, Trust, and Power

Royalties used to flow from physical CDs or iTunes downloads. Now, the industry runs on clicks, skips, and saves. And with that shift, power has moved to the platforms themselves, a setup that makes manipulation easier and oversight harder.

Streaming payouts are complicated even in the best-case scenario. But when bots and backend deals enter the picture, things get murkier. It’s not just a transparency problem. It’s a trust problem. Even well-known artists say streaming numbers don’t always mean financial sustainability. And for independent creators trying to make a living, inflated data hurts twice: they get buried in discovery algorithms and shortchanged in payout models.

As Drake’s legal team puts it, “Streaming platforms, like Spotify, use streaming data to proportionally allocate and disperse payments, which means streaming fraud diverts funds from artists whose songs are legitimately streamed by real consumers to those who use automation to falsely create the appearance of legitimate streaming.”

This isn’t a new complaint. Artists, indie labels, and advocates have been calling for transparency for years. Groups across Europe and the U.S. have pushed for access to backend data and more clarity around algorithmic curation. Without it, the market remains tilted and opaque.

Streaming data now functions as career currency. It shapes touring budgets, brand deals, sync placements and almost every downstream opportunity. And for the artists who don’t have a label machine behind them, the opacity of that system makes it harder to compete on anything close to a level playing field.

That imbalance also locks artists out of fast-growing income opportunities. Goldman estimates that if just 20% of paying subscribers worldwide are “superfans” (meaning those willing to spend 2x the average fan) it could unlock over $4.2 billion in additional revenue. But if that growth depends on algorithmic exposure and playlist favor, it’s not likely to benefit those who need it most.

The stakes aren’t limited to the U.S., as Goldman projects that 70% of all new streaming subscribers by 2030 will come from emerging markets. If algorithmic opacity remains the norm, these regions risk replicating the same inequities seen in the current system, just on a bigger scale.

As the dust continues to settle from Drake’s filings, the bigger question is whether the industry will start demanding real transparency – or whether we’ll just keep optimizing for the algorithm.

Legal Entertainment has reached out to representation for comment, and will update this story as necessary.