DCMS music streaming mark sutherland

DCMS music streaming report: good news for #brokenrecord and #fixstreaming campaigns

It’s the most hotly anticipated report from a Parliamentary committee since… well, ever, basically. Parliamentary committee reports are, after all, not usually very interesting.

But the UK Department for Digital, Culture, Media & Sport Committee’s report into the economics of music streaming has been energising the music industry ever since it was published at midnight on Wednesday. And it makes a number of recommendations that, if taken up by the government, could change the face of digital music like nothing since the invention of Spotify.

At this point, it should be noted that the UK government is not actually under any obligation to do any of the things it recommends. Parliamentary committees have no legislative powers. But they can prove influential – on industry as well as government – so it would be a surprise if the current streaming status quo survives completely unaltered.

The government now has a couple of months before it has to respond to the report, and the industry the same time to lobby them furiously. But artists, songwriters, labels, publishers and everyone else involved in the music of business will surely already be considering their own next steps. And to save you the trouble of reading the report’s 119 pages, Audio Media International analysed its content and had a stab at working out who is likely to come out of the process in a better position, and who won’t be quite so thrilled…


Whatever your position in this debate, you have to salute the impact of the twin campaigns for artists to receive more money from streaming. Tom Gray’s #BrokenRecord, plus #FixStreaming, brought to you by the Musicians’ Union and the Ivors Academy, have galvanised artists online and been supported by everyone from Paul McCartney to Chris Martin.

And their key demand – that the equitable remuneration (ER) right that applies to radio play and ensures that royalties are split 50/50 between performers and rights-holders should also be applied to streaming – is endorsed by the report.

Both major and indie labels contest how good a solution ER would actually be, but the committee was convinced and, if the government follows suit, it would have to go down as a stunning victory for the campaigners.


Universal, Sony, Warner and the BPI would no doubt have been braced for some of the report’s recommendations, after a rough ride for the majors’ bosses – David Joseph, Jason Iley and Tony Harlow – during a session earlier this year.

But the report comprehensively rejects the notion that streaming is working for most people (although the evidence sessions did lack input from artists doing well on the format). You suspect the big three will be able to live with ER being applied to non-elective streams. But the prospect of a potential Competition and Markets Authority (CMA) investigation into their alleged “market dominance” will be causing a lot of consternation in the boardrooms.

BPI chief executive Geoff Taylor pledged to study the report but warned that any policy proposals should not “imperil this country’s extraordinary global success in music”.

DCMS Music streaming Kevin Brennan
Kevin Brennan, MP

And DCMS Committee member Kevin Brennan MP, above, rejects any suggestion the labels were treated unfairly during the inquiry.

“They’re obviously not used to having to account in that way for the practices in the industry,” he says. “But they did have an opportunity to give oral evidence and also to submit supplementary evidence. They are very powerful corporate entities with lots of resources at their disposal to make their case, so I can’t see how they can possibly complain. It’s just that they don’t like the conclusions the committee came to.”


When the inquiry was announced, many people assumed it would be Spotify, Apple Music, Amazon Music et al who were in the firing line. But in fact, aside from a call for research into the impact of algorithms on music consumption – and a warning shot across the bows of Spotify’s controversial Discovery Mode – the DSPs emerge relatively unscathed. Expect them to keep their heads firmly down for a while…


If a lot of the DCMS inquiry ventured into unchartered territory, the reanimation of ‘the value gap’ debate seemed like a rehash of old arguments. The difference is, this time, someone was actually listening. The report recommends that YouTube’s “market dominance” is also referred to the CMA, while suggesting new UK legislation is needed around safe harbour. That will exasperate YouTube, which spent a fortune lobbying against the European Copyright Directive, but at least it was a crumb of comfort for the beleaguered labels, who have long pushed for a level playing field between YouTube and other services.


Many were surprised at how little time the inquiry spent looking at songwriting, and you could be forgiven for thinking the report did the same. But, while it’s the stuff about artists and labels that really catches the eye, the report also recommends the government looks at “how to ensure the song is valued in parity with the recording”. If that actually happened, hitmakers – notably undervalued in what is now very much a songs business – everywhere would be getting a big bonus.


Publishers represent songwriters, so any increase in the song’s value should benefit them as well. However, the report also suggests that the CMA should look at the relationship between the major labels and the major publishers and how it “has influenced the relative value of song and recording rights”. The Music Publishers Association also attracted some criticism, with the report saying: “It is conspicuous that the MPA refused to give a definitive perspective on the debate, particularly given that the publishing arms of the three major music groups are counted amongst their members.” Expect this one to take a long time to untangle.


Unless you’re in Queen, there has been precious little good news for older artists around streaming, particularly for those still trying to recoup on their original deals. But the report suggests the creation of a right to renegotiate contracts if royalties are “disproportionately low compared to the success of the music”. It also recommends the creation of a right to recapture works, perhaps as soon as 20 years after the deal was done. If you were to put money on one thing that will definitely happen out of all this, it would probably be in this area: in a pre-emptive strike, Sony has already agreed to no longer recoup against pre-2000 deals (prompting some rare praise for a major from the committee), while the progress made by the likes of BMG in what Ivors Academy chair Crispin Hunt calls the “fairness arms race” means no one can really afford to be left behind.


The report says indies need more help to compete with the majors, and also suggests greater financial support for the BPI’s Music Export Growth Scheme that helps boost indie acts overseas. But independent labels also oppose the introduction of ER for streaming. That’s why AIM CEO Paul Pacifico welcomed much of the report, but also warned that ER “will not deliver the outcome they are hoping for”. Interesting times.


User-centric – whereby each subscriber’s £9.99 is divided up only amongst artists they have actually listened to – was the buzz phrase of the early sessions, not to mention the solution that seems to resonate most with the public. But it fell by the wayside as the inquiry progressed, and campaigners focused on ER. User-centric is still mentioned as an interesting possibility in the report, but it stops short of recommending a trial, even though SoundCloud has introduced it for DIY artists and Deezer has long been keen to launch it. Sadly, looks like they’ll have to keep waiting.

The inquiry stage of this process has not been good for fragile music industry unity, with seemingly no one willing or able to persuade the various sectors to stop kicking lumps out of each other in public.

But now it’s all out in the open – and the threat of regulation and/or legislation looks much more real – it’s to be hoped that some good, old-fashioned backroom diplomacy returns to the biz. After all, DCMS Minister Caroline Dinenage has already indicated she’d prefer the music industry to come up with its own solution, and Kevin Brennan is also keen for the majors to be proactive.

“Our report might be at the cutting edge of this,” he says. “But the truth is, the industry itself is predicting huge future profits and a recovery to revenue levels consistent with its highest-ever performance in its history. All of that means that they’ll have to do something to improve artist remuneration. If it’s not this, then they should come up with their own proposals for doing it. Labels taking their own steps would be extremely welcome, and I think they’d be wise to do it.”

After all, if parliamentary committee reports can somehow become interesting, it’s surely not impossible for industry and creatives to come up with a streaming solution where everybody wins. Watch this space…