Earlier quoted context omitted.
Internally, they refer to it as “perfect fit content” (pfc). It used to just be stuff like white noise and rain sounds, but it has expanded to essentially be a modern Muzak replacement. For situations when people don really want “music” and just need “contextually appropriate aesthetically pleasing sound”
That makes all the sense in the world to me. I'd call that an entirely legitimate use for AI generated music.
But unless these tracks are treated differently in Spotify's payout system, they're extremely profitable, and because payments come from a common pool, they hoover up payments which would otherwise have gone to artists people actually like.