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MPs want a “complete reset” on music streaming

The UK Government’s report investigating the ‘Economic of Streaming’ launched in October 2020 has concluded that the current streaming model needs a ‘total reset’.

The outcome of a report which investigated the Economy of Streaming by the government has called for UK artists to earn a fairer share of royalties. This would involve a “complete reset” of the current music streaming system.

With streaming surpassing all other mediums of music consumption, UK record labels make £736.5 million from streaming, with artists seeing a measly 16% of this figure. 

A BBC report details Spotify as paying between £0.002 and £0.0038 per stream; Apple Music pays roughly £0.0059. This totals to around £300 per 100,000 streams an artist would actually receive. 

Youtube was also heavily criticised in the report, as evidence detailed that:

“accounts for 51% of music streaming per year but contributed 7% of all revenue.” 

The recommendations from the inquiry included:

  • The introduction of measures allowing music creators to recapture the rights to their work from labels after a period of time;
  • Give artists the right to adjust contracts if their work is successful beyond the remuneration they receive;
  • The government should introduce legally enforceable obligations to normalise licensing arrangements for user-generated content-hosting services such as YouTube;
  • The government should also require publishers and collecting societies to publish royalty chain information to provide transparency to artists about how much money is flowing through the system;
  • Competition and Markets Authority (CMA) to launch a study into the “economic impact of the majors’ dominance”.

The rest of the report can be read here. The overall message of the inquiry is a strongly negative outcome for the streaming industry and its existing structure. Although these recommendations are made up from a government inquiry, they are yet to be legally binding; the government will now discuss the recommendations from the inquiry in more detail before finalising any binding terms of change.

MP Julian Knight went on to say:

”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.”

This clearly signals a dramatic change in how the streaming industry will work moving forwards, with MPs seemingly unanimous on their call for giving artists a more fair share of their cut with a 50% split.




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