Spotify Cuts Suspicious Streams, So So Def Sues Sony Over Royalties, BBC Outlines AI Transparency Plans

How The Music Business Works - Issue #69

July 09, 2026

Welcome back to How the Music Business Works.

This week’s music business updates move across streaming integrity, royalty accounting, AI transparency, market data, and copyright litigation.

Spotify removed more than 500,000 streams from Malcolm Todd’s “Earrings” after suspicious activity tied to prediction-market betting, while Jermaine Dupri and his So So Def companies sued Sony Music over alleged unpaid and underreported royalties. The BBC also outlined how it plans to approach AI-generated and AI-assisted music across its platforms, with a focus on meaningful human creativity and transparency.

Also, Spotify shared new data on the share of US streams going to American artists, and a major reggaeton copyright case involving the “dembow” rhythm is moving toward its next phase.

Here are the key developments that shaped the week.

Spotify cuts streams after suspicious Kalshi activity

Spotify has removed more than 500,000 registered streams from Malcolm Todd’s “Earrings” after the song’s rise to No. 1 on the platform’s daily US chart was linked to betting activity on prediction market Kalshi. Kalshi allows users to stake real money on future events, including which song will be the most-streamed on Spotify in the US in a given month. The Financial Times reported that streams of “Earrings” climbed about 70% in one day before reaching No. 1 on June 29. Bloomberg reported that Spotify later removed artificial streams it did not believe came from genuine listeners, sending the track back to No. 4. Spotify said it has detection and mitigation systems for manipulated streams and does not pay associated royalties. The inflated figures had already been used to settle a Kalshi market, and Spotify has asked Kalshi and Polymarket to remove its logo from their sites. There is no suggestion that Todd or his team were involved.

So So Def sues Sony over alleged unpaid royalties

Jermaine Dupri and his So So Def companies have sued Sony Music Entertainment for more than $18 million, alleging years of unpaid and underreported royalties. The complaint was filed July 6 in the US District Court for the Southern District of New York and spans recordings by Kris Kross, Xscape, Da Brat, Jagged Edge, Usher, Mariah Carey, Bow Wow, J-Kwon, and Bone Crusher. The relationship dates back to a 1992 label agreement under which So So Def submitted artists to Sony. The complaint alleges Sony failed to report producer or override royalties on Kris Kross’s first two albums until 2023, and that more than $2.2 million remains owed on those records alone. It also points to alleged underreporting on Xscape and Da Brat recordings, along with claims tied to Xscape’s recoupment account. Sony said the matter concerns a royalty accounting dispute the parties had been trying to resolve before litigation.

BBC outlines AI transparency commitments

BBC Director of Music Lorna Clarke has outlined the broadcaster’s approach to AI in music, saying BBC radio stations and platforms will prioritize music that reflects “meaningful human creativity.” Clarke said artists using AI tools can still be considered for programming, but those tools should support human creativity rather than replace the work of developing, shaping, or expressing a creative idea. The BBC also wants artists and partners submitting music to be transparent about whether and how AI was used in the work. Clarke said audiences care about musicians and human creativity and may want to know when AI has supported the music they are hearing. The article notes that this will be challenging while the industry still lacks consistent rules for identifying, declaring, and labeling AI use, especially in AI-assisted music rather than fully AI-generated tracks, and while AI detection tools remain debated.

69% of US Spotify streams go to American artists

Spotify says 69% of all streams in the US go to American artists, while American music accounts for 70% of the Spotify Top 50 chart in the US in 2025. The company shared the figures in a blog post tied to the 250th anniversary of the US Declaration of Independence. Spotify also pointed to export activity, saying people outside the US streamed songs featuring at least one American artist 776 billion times over the past year. Country music received a separate highlight, with streams of American country music outside the US nearly doubling over the last five years, up 94%. The article notes that while the data is positive for the US industry, it also connects to ongoing concerns in other English-speaking markets, including the UK, Canada, and Australia, about domestic music scenes, streaming algorithms, and the influence of recommendation systems in global discovery. These figures may influence policy debates and industry strategies worldwide.

Reggaeton “dembow” copyright case moves forward

A US federal judge has ruled that a jury must decide whether production duo Steely & Clevie created the “dembow” rhythm used across reggaeton. Judge André Birotte Jr. issued the decision July 1, keeping alive a copyright lawsuit that names Bad Bunny, Karol G, and more than 150 other artists over nearly 2,000 tracks. The suit alleges those tracks copied Steely & Clevie’s 1989 song “Fish Market,” which the plaintiffs say is the copyrightable source of the dembow rhythm. Defendants, including artists and units of Universal Music Group, Sony Music, and Warner Music Group, argue the sound exists in earlier works and genres, including the habanera rhythm. The judge found competing expert opinions on whether the musical elements are original, commonplace, or protectable. The case now moves to discovery focused on access and copying, with a jury trial possible unless the parties reach a settlement.

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