1.Music streaming is the process whereby music multimedia is accessed by consumers over the internet. Streaming has irrevocably changed modern music consumption and, as musicians have been restricted from touring and performing live during the Covid-19 pandemic, they have become solely reliant on revenue from recorded music. Some successful, critically acclaimed artists have found that the earnings from streaming “are not significant enough to keep the wolf away from the door”. Some hit songwriters have found that they cannot live off streaming revenue and are “forced to live on universal credit” with the Government “picking up the bill”. In response, musicians have mobilised, calling for a review of how recorded music revenues are shared.
2.Our decision to examine the economics of music streaming complements our previous work on the broader economic impacts of the Covid-19 pandemic on the digital, culture, media and sport sectors and our recently-Reported inquiry into UK music festivals. Last year, we heard that 90 percent of UK festivals had been cancelled and 93 percent of grassroots music venues faced permanent closure. We also alerted the Government to the fact that a quarter of the music industry workforce, including 42 percent of respondents to a Musicians’ Union survey, did not qualify for the Self Employed Income Support Scheme and producers and sound engineers had lost an average of 70 percent of their income. We recommended, in our Report on ‘The Impact of COVID-19 on DCMS sectors’, that the Government “should investigate how the market for recorded music is operating in the era of streaming to ensure that music creators are receiving a fair reward”. The Government’s response to our Report stated that it had tasked the Intellectual Property Office (IPO) with supporting an independent qualitative and quantitative research project, jointly funded by Nesta and supported by a coalition of industry bodies, to investigate how music creators earn money from streaming. The project is led by Dr Hyojung Sun, Ulster University, Professor David Hesmondhalgh, University of Leeds and Dr Richard Osborne, Middlesex University, and (at the time of writing) is due to report in the summer 2021.
3.That said, dissatisfaction with music streaming within the music industry predated the Covid-19 pandemic. In its 2019 Report on Live Music, our predecessor Committee considered whether existing income streams for musicians are sustainable. It recognised that digital music consumption provided “significant opportunities for artists to distribute their music and reach new audiences” but that “labels and musicians struggle to make sufficient returns from their creative output”. Services that host user-generated content (UGC)/user-uploaded content (UUC) in particular were criticised for the “shameful rates” paid to the music industry for digital music consumption. Our predecessor Committee also noted that the Government similarly expressed dissatisfaction with the current rates of remuneration offered to artists through streaming services but did not make any streaming-specific recommendations.
4.The abrupt and enforced loss of live music income for musicians during the pandemic subsequently recontextualised concerns about the economics of music streaming. In March 2020, the #BrokenRecord Campaign, founded by Gomez vocalist, guitarist and songwriter Tom Gray, gained considerable traction on social media, bringing together musicians, industry professionals, fans and other parties dissatisfied with artist remuneration from music streaming in order to agitate for changes to the existing model. Mr Gray has called for “the restoration of a larger, secure, professional class of artist, songwriter and performer” and for “kids to be able to aspire to make a living from original music, not simply huge fame or bust”. In May 2020, the Ivors Academy of Music Creators and the Musicians’ Union launched the Keep Music Alive campaign to “fix streaming” by starting a petition that called on the Secretary of State for Digital, Culture, Media and Sport, Oliver Dowden MP, to explore regulation and reform of the music streaming market. The public debate provoked by the campaigns was welcomed by Kim Bayley, CEO of the Entertainment Retailers’ Association (ERA), a trade organisation representing physical and digital music, video and videogame retailers and wholesalers such as Amazon, SoundCloud, Spotify and YouTube. However, Geoff Taylor, CEO of the British Phonographic Industry Ltd (BPI), a trade association for UK record labels, argued that the industry’s “focus should be on growing the streaming pie rather than trying to argue over where that streaming pie should go”. The perspectives of creators, the record industry and music streaming services largely consolidated along these lines throughout our inquiry.
5.We launched our inquiry in October 2020 to consider the impact of music streaming on the creators and companies that comprise the music industry and examine the long-term sustainability of the industry itself. We have received almost 300 pieces of written evidence, organised an engagement event with emerging artists and held seven oral evidence sessions during which we heard from performers, songwriters, composers, music companies, trade bodies, collecting societies, government ministers and, of course, the streaming services themselves.
6.However, our inquiry highlighted concerning practices. Participants in our roundtable discussion noted that many emerging artists are afraid to speak out because “they don’t want to fall out of favour” with market gatekeepers. Several performers who did give evidence claimed that they and many of their peers were afraid of speaking out against the status quo for fear of losing favour with major record labels and streaming services. As Elbow frontman and BBC 6 Music presenter Guy Garvey argued, “however leaky the boat has become, young musicians still don’t want to rock it, and if they don’t rock it they can’t make ends meet, particularly in genres where how much money you have is part of your lyrics”. Furthermore, some potential witnesses privately raised concerns that speaking publicly would bring negative consequences for them. It is, therefore, unsurprising that we received almost eighty confidential submissions to our inquiry. On 1 December 2020, our Chair considered it necessary to make a statement on the issue:
We have been told from many different sources that some of the people interested in speaking to us in relation to this inquiry have become reluctant to do so, because they fear action may be taken against them if they speak in public. I would like to say, on behalf of the Committee, that we would take a very dim view indeed if we have any evidence of anyone interfering with witnesses to one of our inquiries. No one should suffer any detriment for speaking to a parliamentary Committee, and anyone deliberately causing harm to one of our witnesses will be in danger of being in contempt of this House. This Committee will brook no such interference and will not hesitate to name and shame anyone proven to be involved in such activity. Anyone who wants to come forward to speak on this issue or any other issue should get in touch with the Committee and will be treated in confidence.
7.The economics of music streaming is a complex and idiosyncratic object of study. As such, Chapter 2 of this Report will provide an overview of the rise of digital music, including a historical overview of music streaming, its legal underpinnings and the consumer perspective, in order to provide the necessary context to the issues that will subsequently be examined. Our Report will then focus on three broad areas:
Due to the prevalence of jargon used by industry stakeholders (and therefore used throughout this Report), Annex 1 provides a glossary of relevant terms.
1 Q75 [Nadine Shah]
2 Q181 [Fiona Bevan]
3 Ivors Academy of Music Creators, , accessed 23 March 2021
4 Digital, Culture, Media and Sport Committee, Third Report of the Session 2019–21, , HC 291
5 Digital, Culture, Media and Sport Committee, First Report of the Session 2021–22, , HC 49
6 Digital, Culture, Media and Sport Committee, Third Report of the Session 2019–21, , HC 291, paras 43–4
7 , Qq37–39
8 Digital, Culture, Media and Sport Committee, Third Report of the Session 2019–21, , HC 291, para 44
9 Digital, Culture, Media and Sport Committee, Third Special Report of the Session 2019–21, , HC 885, para 10
10 Dr Hyojung Sun, Prof. David Hesmondhalgh and Dr Richard Osborne ()
11 Digital, Culture, Media and Sport Committee, Ninth Report of the Session 2017–19, , HC 733, para 111
12 Digital, Culture, Media and Sport Committee, Ninth Report of the Session 2017–19, , HC 733, para 111
13 Digital, Culture, Media and Sport Committee, Ninth Report of the Session 2017–19, , HC 733, para 112
14 “”, Music Ally, 18 May 2020
15 “”, Music Business Worldwide, 23 February 2021
16 Ivors Academy of Music Creators, , accessed 23 March 2021
17 Entertainment Retailers’ Association, , accessed 23 March 2021
18 “”, Music Week, 29 May 2020
19 Transcripts of roundtables with emerging artists ()
20 Qq21, 76, 98–101
22 taken on 1 December 2020, HC (2019–21) 869