> Let's imagine these "artists" are all actually created by a team of software engineers at Spotify tweaking a GPT-3-like model for songs. If the songs get listens and users like them, so what?

I don't think anyone has a problem if users listen to or like machine-generated music. Some people, including some paying customers, would have a problem with this music being presented to them opaquely as if it has gone through the same creative process as human-generated music.

To your other point, re: Backstreet Boys, they're not any more authentic, at least not in my perspective. But the fact that I may find Backstreet Boys completely "soulless" or not a "genuine form of artistic expression" or "lacking in musical talent" is all my problem/opinion, and it's all orthogonal to the point, which is that the promotion of Backstreet Boys, by way of a record label allocating marketing spend to pay a radio station to play their music on repeat, ought to be transparent. There are even "payola" laws about this in the US, complete with a known and abused loophole: https://en.wikipedia.org/wiki/Payola#Third-party_loophole

> ...You're clicking a playlist...

The question becomes, "How did the user find the playlist?" I don't know how organic the process is for getting these playlists in front of a user's face. If Spotify does any kind of algorithmic fuckery to present that playlist more prominently to a user -- while, on the backend, accounting for the fact that the playlist will benefit them financially because the royalties are lower because the artists are "fake" -- then that should be disclosed to the user in some form. I'm not actually suggesting a law or regulation here. But if I were still a Spotify customer, I'd prefer to know if they generated and presented content to me because it benefit them financially rather than because they think I'd enjoy listening to it.

The problem would be that the platform serving the music (and making recommendations of what to listen to) has a strong incentive to promote their own brand, creating a competitive disadvantage for "real" musicians on the same platform.

This is the music equivalent of Amazon Basics. If Spotify really is creating fake artists to avoid paying real artists, it's the same kind of monopolistic vertical integration as Amazon manufacturing their own products to avoid paying third-party sellers.

AmazonBasics products are branded so the consumer knows that they’re Amazon products. Same for Netflix originals.

Spotify associated labels and playlists should have a disclaimer as well.

Think from a musicians perspective though. Real artists making real music lose out. Someone is looking for music in your genre, and Spotify just serves them their own stock music so they don't have to pay you for your music.