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UK Parliamentary committee calls for new regulation of music streaming rates for musicians: “A complete reset”

A UK Parliamentary committee has issued a dense report (HERE) which analyzes the music streaming industry, with focus on the money-making issues and prospects for British musicians. This 97-page document, which cites quotes from Will Page, Tom Truitt, and other experts well known to RAIN’s audience, can be considered similar to a congressional report in the U.S. — attention-getting, possibly influential, but far away from being an explicit recommendation of, or draft of, law. We see it as an academically styled whitepaper examining how UK musicians make money from their recordings.

To some extent, the timing of this (untitled) manifesto is a reaction to musicians’ plight during Covid: “Whilst commercial music creation is intensely competitive, it is reasonable to expect that at least professional musicians, who otherwise are able to support their livelihood with live music income, are similarly participating in this [Covid] recovery. Instead, income from recorded music is meagre.”

About the Labels

But for the most part, the focus is on how record labels pay the musicians under contract. As such, the target of the committee’s reformatory thrust is the record label industry more than the streaming music services. “For labels, the music industry is thriving,” the document quotes Will Page as saying in support of this thesis. (Page is the former Chief Economist at Spotify and is currently a visiting Fellow at the London School of Economics and Political Science.)

The paper reels off statistics about aggregate earnings for musicians. Many of these numbers are divorced from corresponding streaming metrics which would indicate a success level in the streaming marketplace. One example: “In 2019, 82 percent of professional musicians made less than £200 from streaming, whilst only seven percent made more than £1,000.175 Furthermore, 91 percent of respondents stated that they earned less than £200 from their most played track across all platforms in 2019.176 In the context of the Covid-19 pandemic, where other income streams have necessarily dried up, this situation has become untenable.”

The situation might well be untenable, but without comparison to streaming performance, the above pronouncement risks sounding like a success pyramid in any media category.

Education and Recommendation

The report is meant to be educational to Parliamentary colleagues. The first two quite sizable sections explain how the industry works generally. It doesn’t shy away from sticky issues of remuneration tracking and copyright complexity which plagues the streaming music industry generally. “There is widespread consensus across the music industry and amongst the music streaming services that issues with the metadata are a significant challenge to efficient and correct rightsholder remuneration,” the paper states. Following that, it simply refers to the problem as “bad metadata.”

Collective licensing, as is regulated in the U.S. via the Copyright Royalty Board and SoundExchange collections for use of recordings in streaming, is a focal point of the document. Tom Frederikse, a London-based lawyer and former music producer, is quoted: ”

“I think the easy answer to ‘What is [equitable remuneration]?’ is that it is collective licensing. It does create a restriction on the exclusive rights of the rights holder to negotiate for themselves. But as you have heard many times this morning, the artist-label negotiation rarely takes place on a level playing field, so this goes some way towards helping that problem. Also, as we can see in the US and elsewhere, collective licensing for all forms of streaming and broadcasts is certainly possible.”

Spain’s system is also mentioned. to some extent, the Parliamentarians are telling their colleagues to catch up with other societies. Here is the crucial recommendation:

“The right to equitable remuneration is a simple yet effective solution to the problems caused by poor remuneration from music streaming. It is a right that is already established within UK law and has been applied to streaming elsewhere in the world. A clear solution would therefore be to apply the right to equitable remuneration to the making available right in a similar way to the rental right. As such, an additive ‘digital music remuneration’ payment would be made to performers through their collecting societies when their music is streamed or downloaded. This digital music remuneration would address the issues of long-term sustainability for professional performers and the cannibalisation of other forms of music consumption where equitable remuneration applies, whilst also retaining the benefits of direct licensing.”

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Brad Hill

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