November 6, 2025
Spotify faces a second lawsuit this week, alleging that its Discovery Mode function constitutes payola.
Days after dealing with a lawsuit over allegedly inflated Drake streams, Spotify is now being named in a class-action lawsuit that labels its Discovery Mode function as a “trendy type of payola.”
In a lawsuit filed in New York on Nov. 5, Spotify’s Discovery Mode software is accused of functioning as a “misleading pay-for-play” system, enabling file labels and artists to secretly pay for promotion whereas deceptive customers into believing the suggestions are unbiased and tailor-made to their preferences, Billboard stories.
“Spotify exploits that belief by advertising and marketing itself as a platform that gives natural music suggestions — whether or not by its algorithmic or curated playlists — solely to secretly promote these suggestions to the best bidder,” the lawsuit states.
Subscriber Genevieve Capolongo is spearheading the class-action lawsuit on behalf of the “hundreds of thousands” of customers allegedly misled by Spotify’s suggestion instruments. Her attorneys declare that regardless of utilizing the platform’s personalization options for years, she “stored listening to the identical major-label tracks” that “bore little resemblance to her listening habits.”
The lawsuit facilities on how clearly Spotify discloses the mechanics of Discovery Mode to customers. Launched in 2020, Discovery Mode lets artists and labels increase their presence on Spotify in change for decreased royalties. Regardless of preliminary considerations—together with a Congressional investigation over its resemblance to payola, the apply of secretly paying for radio airplay—it has grow to be a broadly used advertising and marketing software within the music business, particularly for brand spanking new releases. Whereas listeners can entry an “About Suggestions” hyperlink, Capolongo’s attorneys argue that this clarification is inadequate.
“Telling customers that ‘industrial issues could affect’ suggestions doesn’t reveal which songs are being promoted commercially and that are being really helpful organically,” her attorneys wrote. “With out that specificity, customers can not distinguish between real personalization and covert promoting.”
The newest lawsuit provides to claims that main labels are shopping for placement on Spotify to spice up their artists. A high-profile 2024 case filed by Drake over Kendrick Lamar’s “Not Like Us” accused Common Music Group of utilizing bots and funds to inflate the track’s reputation throughout a number of platforms, together with Spotify. Earlier this week, one other lawsuit alleges that Spotify has “turned a blind eye” to bots and different fraudulent streams used to artificially increase artists like Drake.
Spotify has responded to Capolongo’s lawsuit, calling the claims “nonsense” and providing readability on how the Discovery Mode software works.
“Not solely do they misrepresent what Discovery Mode is and the way it works, however they’re riddled with misunderstandings and inaccuracies,” the corporate mentioned. “Discovery Mode is a function artists can use to flag precedence tracks for algorithmic consideration in restricted contexts: Radio, Autoplay, and sure Mixes. It doesn’t purchase performs, it doesn’t have an effect on editorial playlists, and it’s clearly disclosed within the app and on our web site.”
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