Members who have been following the Musicians' Union and The Ivors Academy's Fix Streaming campaign will know that we started campaigning for a government review of music streaming in 2020 and shortly afterwards a Select Committee Inquiry was launched.
The thorough music streaming inquiry by the Digital, Culture, Media and Sport Select Committee resulted in an excellent set of recommendations.
Since then, the Government and Intellectual Property Office have been running a process to look at issues with music streaming; transparency, metadata and creator remuneration. The Union has been involved and I sit on the 'contact group' which is essentially the steering board for the whole process.
The most important issue from the Musicians' Union's perspective is creator remuneration
The transparency and metadata work streams have resulted in codes of practice, signed by the Musicians' Union and the other industry trade bodies who sit on the contact group.
Both improving transparency in relation to royalty accounting and getting metadata right, i.e. ensuring that contributors to a recording are credited and know what they're due to be paid, are important. However, the most important issue from the Musicians' Union's perspective is creator remuneration.
The music industry is powered by you
The UK music industry is powered by the talent of our members. Music fans don't follow and love record labels, they follow and love artists, performers and songwriters.
There must be a rebalancing of revenue distribution in favour of those who actually make British music
However, the streaming revenue pot is currently divided roughly 30% to the streaming platform, 55% to the record label who will account to the artist according to contract and 15% to the music publisher (who will account to the songwriter). While music publishers often pay songwriters 80% of the revenue they receive, record labels pay artists a maximum of 26% on a traditional-style recording contract, and with older contracts the figure will often be much lower.
Many artists receive far less because their royalty rate is less in their contract and/or they have not recouped the upfront investment by the label. Session musicians receive no royalties at all from streams of music they perform on, unlike for radio play.
There must be a rebalancing of revenue distribution in favour of those who actually make British music.
You should have an equal seat at the table
The Government announced that they would convene a group to discuss creator remuneration in May 2023. This week, after months of pushing, the members of the group were finally announced. At the same time a report was published looking into 'equitable remuneration'.
The Musicians' Union, and other unions around the world, have been campaigning for equitable remuneration on music streaming which essentially means guaranteed royalties for performers on streamed tracks. Payments would most likely flow via PPL as per radio royalties.
We are very disappointed to see that the membership of the creator remuneration working group is heavily weighted towards the record labels and music publishers. There are only four performer/creator representatives on the group of twenty - just 20%.
In addition to our four seats, there are two representatives of music streaming services, eleven label or publisher reps, two collecting societies (PRS and PPL) and UK Music. PRS, PPL and UK Music are essentially neutral because they represent creators' interests as well as labels and/or publishers.
We are very disappointed to see that the membership of the creator remuneration working group is heavily weighted towards the record labels and music publishers
So, with over half of the group taken up by record labels and music publishers who don't want to see any reapportioning of revenue, how can the Musicians' Union go into this process with any confidence that our members' concerns will be taken seriously?
Four of the five creator bodies who make up the Council of Music Makers (CMM), a group we convened so that we could collectively fight for a better deal for all music makers, have been given one representative on the group each. I will be representing the Musicians' Union.
This is in contrast to, for example, the major labels who are each represented individually, as well as by their trade organisation, the BPI. The Music Producers' Guild (MPG) have been left out of the group despite being one of the five CMM organisations lobbying and campaigning for change.
Everything must be on the table for the group to do its job
In addition, we are concerned that the UK Government has already ruled out the ‘broadcast model’ of equitable remuneration, the potential of which was holding the record labels' feet to the fire on remuneration issues.
There was a statement from the BPI, representing the record labels, earlier this week in response to this news which was frankly celebratory. They appear to feel they are off the hook before the working group process has even begun.
Meanwhile, other territories internationally are introducing equitable remuneration. Performers in the United States already receive streaming royalties.
The average annual earnings for a musician remain below £25k
The Government's report into equitable remuneration, just published, paints a picture of record labels unable to afford fair payments to artists and session musicians without deducting equivalent sums from investment and advances offered. This fails to take into account record profits being made by these corporations.
Recorded music revenue has increased by 57% (£400m) since 2015, while musicians' earnings have remained largely static. Session fees for musicians have increased by just £3 per hour during the same period, an increase of 8% on a low starting point of £40 per hour. The average annual earnings for a musician remain below £25k.
Administration should not be a barrier to fair payment
The report also fails to acknowledge that record label execs receive eye-watering bonuses. The idea that labels' running costs have increased precisely in line with this significant increase in revenue, and therefore any extra payments to performers would need to come from their A&R budgets alone, is frankly an insult to the artists they purport to represent.
The equitable remuneration modelling presented by Government is essentially a zero-sum mathematical equation; if some performers get more, labels will get less.
The report acknowledges the enormous dominance of catalogue recordings in the streaming market, but the model only focuses on the five years since release. This is clearly a skewed picture, favouring the labels and ignoring the long tail of recordings that continue to attract many streams and generate profits, but where the artists and session musicians may be paid low or no royalties.
The argument that distributing more royalties would cost money, and is therefore to be discouraged, is hardly morally sound
It does not consider that international income from music streaming subscriptions has consistently grown year on year and continues to do so either. The argument that distributing more royalties would cost money, and is therefore to be discouraged, is hardly morally sound.
It being difficult and costly to pay the musicians who actually made the music, does not justify the majority of revenue remaining with labels or being handed out to their Chief Execs. PPL and PRS already deal with billions of lines of data and distribute millions of pounds, so administration should not be a barrier to fair payment.
Putting the value of music back where it belongs - in your hands
The Creator Remuneration Working Group must be better balanced and offer a level playing field. After decades of the power being held by and abused by major rights holders, we cannot enter another negotiation on the back foot.
Our collective voice as a union with over 34,000 members gives us power in these negotiations
Rest assured that the Musicians' Union will never give up fighting for a fair deal on music streaming. Our collective voice as a union with over 34,000 members gives us power in these negotiations.
It is also important to have collective power as a wider group of creators, which is why we're campaigning as part of the CMM. The CMM is a partnership between the Musicians' Union, The Ivors Academy, Featured Artists Coalition, Music Managers Forum and Music Producers Guild.
Together we can fix streaming. Look out for more from the Union and from the CMM in the coming weeks and months, and make sure you're opted into our regular news emails to stay up to date. Log in to My MU to update your communications preferences.