The denominator moves

When a producer has one more vocal session to book, a steady stream count can look like a small piece of certainty. The royalty calculation has another moving part: everyone else’s eligible plays in the same pool.

Music Business Worldwide’s October 2 preview frames the Michael Smith streaming-fraud case through pro-rata arithmetic. According to the preview, sentencing is scheduled for Tuesday, October 6. The useful question for working musicians is how activity elsewhere can change the allocation attached to their own releases.

An unchanged play count can produce a smaller share when the denominator grows. Some growth reflects people discovering other music. Accepted artificial activity can claim part of a shared pool without representing genuine listener demand. A listening dashboard and a royalty statement can therefore tell different stories about the same release.

A pool on paper

Use fictional accounting units and a deliberately simplified formula. This example does not describe Smith’s accounts or any particular service.

Allocation = distributable pool × your eligible plays ÷ total eligible plays in that pool.

A hypothetical service has 100,000 units to distribute against one million eligible plays. Your catalog accounts for 10,000 plays. Its share is 1%, giving it 1,000 units.

Now add 250,000 artificial plays that the service accepts as eligible. Keep the pool at 100,000 units. The denominator becomes 1.25 million plays. Your catalog’s share falls to 0.8%, giving it 800 units. The artificial activity receives 20,000 units.

The catalog has lost 20% of its allocation despite receiving exactly the same genuine listening.

The fixed-pool assumption is essential. Real activity can also affect revenue, and actual accounting involves separate pools, eligibility rules and deal terms. The calculation isolates dilution. It describes allocation to a rights holder before further splits or deductions determine an individual musician’s income.

Small numbers need units

The MBW headline’s “two plays a day” formulation is a reminder to check the unit behind a number. Plays per track and plays per account answer different questions. A per-track average needs both a catalog size and a time window before it tells us much about aggregate activity.

Across a large catalog, modest activity per recording can produce substantial total listening. That is equally true of legitimate catalogs. An extensive library of cues or alternate mixes can contain plenty of recordings that move slowly. Quiet tracks are part of ordinary musical life.

Genre is a poor shortcut for sorting this out. Sparse ambient music, functional loops and obscure uploads deserve the same scrutiny and fair treatment as pop releases. Release volume and low engagement may prompt questions, but neither independently proves that a listener was fabricated.

Reporting should keep track-level streams, catalog totals and account activity distinct, with the relevant period attached. A monthly catalog total cannot be compared directly with a daily per-track average.

Eligibility rules move the boundary

A minimum-activity rule is one possible policy response. A hypothetical version could exclude recordings below a specified listening threshold from payment.

Such a gate can reduce the reward from scattering activity across many low-play recordings. Its effect depends on the scheme and how the rule is implemented. It can also exclude a real first release or a musician’s slowly circulating back catalog.

Evaluate that design on two separate measures: artificial activity it removes from payable totals, and genuine listening it leaves unpaid. With a fixed pool, a smaller royalty-bearing catalog could produce larger allocations for qualifying music while disappointing musicians below the line.

Eligibility and authenticity answer distinct questions. A recording can miss a popularity threshold despite entirely genuine listening. A recording that clears it still needs integrity checks on its streams.

Before celebrating a threshold, ask how the service treats excluded plays and the money that would otherwise have been allocated to them. Musicians also need a comprehensible explanation of the classification and a route to raise errors.

Follow one listener’s money

A user-centric model changes the unit of allocation. In a simplified subscription version, each listener’s distributable payment is allocated among the eligible recordings that person played. A listener who spends the month with one small catalog directs that share toward that catalog.

Artificial activity outside that listener’s history cannot directly dilute this particular allocation through a service-wide play-count denominator. The boundaries of the pool have changed.

This remains a conditional design argument. Account integrity, valid payments and the treatment of invalid listening still matter. A fraudulent play within a listener’s own history can influence that listener’s allocation. Moving the calculation closer to the subscriber also creates questions about family plans and listening funded by advertising.

The model cannot guarantee an increase for every independent musician. Results depend on which subscribers listen, how much money is attributable to them and how their listening is divided. A useful comparison would show the same catalog under both models, with assumptions about revenue and eligibility kept visible alongside the resulting allocations.

Reconcile the next statement

Keep platform play counts alongside the matching distributor statement, with reporting period and territory recorded where available. Separate listening dates from the date a payment or adjustment appears. A late adjustment should remain identifiable when you compare months.

Dividing royalties by streams gives a diagnostic average for that statement. It does not establish a universal per-play price, because revenue mix and eligibility can differ. Avoid building a recording budget around a rate reverse-engineered from a single month.

A smaller payment alone cannot diagnose streaming fraud. If reported plays hold steady while royalties fall, ask whether the change concerns pool revenue, eligibility, a reporting delay or an adjustment. Request the reporting period and any recorded adjustments first if the full allocation detail is unavailable.

Retain promotion invoices and release records alongside the reports. When a discrepancy appears, send the distributor the affected recording identifiers, service and period. Attach the two statements and mark the line that changed.