UK Lawmakers Call for Sweeping Reform to Streaming Payouts

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The music-streaming model requires a “complete reset” to ensure fair pay for artists, a UK inquiry has found. In tandem with reforms to platforms like Spotify, Apple Music, and YouTube, record labels should split streaming royalties with artists 50/50, according to the report, which was conducted over six months by a cross-party panel of 11 UK lawmakers. (Currently, the average artist’s share of streaming royalties is about 16 percent.) Other recommendations include a study into major-label dominance of the music market by the competition watchdog. The UK government has two months to respond to the report’s advice.

The report, which was conducted with input from musicians, streaming representatives, and other industry figures, also calls for transparency on playlisting and algorithm bias, and suggests a rethink of “safe harbor” legislation, which blocks copyright claims against streaming services that host user-generated content (such as YouTube and TikTok), as long as the services remove the offending content once notified by the rights-holder.

Streaming services “undoubtedly helped save” the music industry from the catastrophic impact of piracy, the report acknowledges. And yet, “while streaming has brought significant profits to the recorded music industry, the talent behind it—performers, songwriters and composers—are losing out,” said Julian Knight, chair of the Digital, Culture, Media, and Sport (DCMS) committee, which conducted the report. “The issues ostensibly created by streaming simply reflect more fundamental, structural problems within the recorded music industry,” the report adds. “Streaming needs a complete reset.”

The most fundamental and immediate change for musicians would be the enforcement of equitable remuneration, a demand pushed by the artist-focused Broken Record campaign. The report recommends classifying streamed music as a rental, helping artists to recoup higher royalties—a stance strongly opposed by major labels and streaming services. “The right to equitable remuneration is a simple yet effective solution to the problems caused by poor remuneration from music streaming,” the report concludes. “It is a right that is already established within UK law and has been applied to streaming elsewhere in the world,” such as in Spain.

The report advised a number of other changes to industry standards and record-label practice. Musicians and songwriters, it suggested, should be able to reclaim the rights to their work after a set period of time; artists should have the right to contract adjustments if their work dramatically outperforms their remuneration; and Warner and Universal Music should follow Sony in canceling artists’ historic debts.

The report received mixed responses across the industry following its release. The Association of Independent Music welcomed calls for reform of major-label standards but argued that equitable remuneration is “a 20th Century solution not fit for the 21st Century digital market,” which stands to “leave the next generation of artists worse off.” Tom Gray, who spearheaded the Broken Record campaign, strongly praised the “damning” report, saying it “reflects an industry that is pocketing a fortune while failing UK performers and songwriters.” The Musicians Union likewise welcomed the report, saying it “identifies the problems and recommends achievable and practical solutions, which won’t cost the taxpayer a penny.”

 

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