For the better part of a year, a U.K. Parliamentary committee has been probing the economics of the modern music industry, questioning the entanglements of players like record labels and streaming services. At midnight British time on Thursday, July 15th, the group dropped the results of its inquiry: a massive report highlighting the “pitiful returns” musicians and songwriters receive from streaming and recommending major changes that would help make music more profitable for those who actually make it.
The 121-page report was issued by Parliament’s Digital, Culture, Media and Sport Select Committee (DCMS), which began its investigation last October. The group heard from an array of artists including Nile Rodgers, Radiohead’s Ed O’Brien and Nadine Shah; many other artists, the report noted, spoke on the condition of anonymity because they didn’t want to fall out of favor with industry power brokers. Representatives for the major labels, as well as streaming platforms including Spotify, Amazon, Apple Music and YouTube, also presented evidence. While the report only offers recommendations — and not actual legislation — it does mark the first time any lawmakers around the world have taken such an in-depth look at who is and isn’t benefitting from streaming’s stranglehold on music.
Among the report’s key recommendations are: a call on the U.K. government to introduce a right to equitable remuneration that would increase royalty payments to performers and session musicians; business-model changes that would make streaming more profitable for composers and songwriters; and mandating that playlist curators disclose paid promotions in a manner similar to social media influencers posting sponsored content. The report also suggests that the U.K. government refer a case to the Competition and Markets Authority to fully study the economic impact of major-label dominance; the report cites “ongoing concerns” about the majors’ position in direct licensing negotiations with streaming services, “which allows them to benefit at the expense of independent labels and self-releasing artists, particularly regarding play listing.”
The DCMS report also voiced concern over the state of U.K. copyright law — specifically, the safe harbor provision that shields sites hosting user-generated content, like YouTube, from content infringement liability. This insulation, the report suggests, gives these services an unfair competitive advantage over others, and greater leverage in licensing negotiations with labels and publishers.
In a statement, Julian Knight, a Conservative member of Parliament and the committee’s chair, said, “While streaming has brought significant profits to the recorded music industry, the talent behind it — performers, songwriters and composers — are losing out. Only a complete reset of streaming that enshrines in law their rights to a fair share of the earnings will do… We have real concerns about the way the market is operating, with platforms like YouTube able to gain an unfair advantage over competitors and the independent music sector struggling to compete against the dominance of the major labels.”
While the report most narrows its eye on streaming, it also includes some pointed recommendations for the three major labels. Most notably, it urges Warner Music and Universal Music Group to look again at the issue of unrecouped debts for legacy musicians, after Sony announced it would wipe those balances back in June.
The DCMS report is being met with praise from several music and songwriting groups in the U.K., including the Musicians’ Union, the Ivors Academy and the #BrokenRecord Campaign. In a joint statement, the three group urged the U.K. government to implement the committee’s recommendations and support a copyright reform bill that will be read and voted on later this year. “This cross-party report is revolutionary,” said Horace Trubridge, General Secretary of the Musicans’ Union. “It grasps the issue, identifies the problems and recommends achievable and practical solutions, which won’t cost the taxpayer a penny. It’s time to make the most of this rare, cross-party consensus, bring British copyright law up to date, show Global Britain leading the fight to protect the intellectual property of artists and creators, and make the UK the best place to be a musician.”
Tom Gray, founder of the #BrokenRecord Campaign, added, “The report brilliant and coherently cuts to the chase: the music industry has a serious problem. Profits are soaring, margins are better than ever, the value of the once piracy-blighted industry is forecast to eclipse anything seen in our lifetimes within a decade, but performers and songwriters are being left well behind.”