The music streaming services they have colonized society. Far are the successes of sales in physical discs to artists around the world that occurred not long ago. However, behind the new streaming strategies are the musical royalties or royalities that the services pay to the artists and their record companies for the eavesdropping on their platforms. This is an issue that is on the table every month and many artists say that they should charge more for their music. A British government proposal aims to increase royalties to artists and platforms such as Apple Music show their bewilderment and prudence about it.
Changes in music royalties, following a UK report
The UK Government has a Ministry of Culture, Media and Sport headed by Nicky Morgan. At the proposal of this ministry, a Committee was created that is in charge of studying various aspects of the ministry in order to legislate in favor of the people that this ministry represents. One of the projects that the Committee introduced in October 2020 was the economic impact of current streaming. According to information from the British Parliament, This studio aimed to:
Examine what economic impact music streaming is having on artists, record labels, and the sustainability of the music industry in general.
The document published by the committee and sent by the UK government shows that current music streaming generates more than a billion pounds annually with more than 115 billion views a year. However, and here is the key, artists only receive 13% of the income generated.
The Chairman of the Committee assured:
While streaming has brought significant gains to the recorded music industry, the talent behind it - performers, songwriters, and songwriters - is losing [money]. Only a complete restart of the transmission will be enough that enshrines in the law their rights to a fair share of the profits ”.
Apple Music: 'It's a narrow-margin business'
The study carried out by the Committee has gathered the realities of record companies, artists, politicians and important personalities of music streaming services. With the aim of delving into the importance of the problem have managed to offer strategies that would solve the negative impact of low musical royalties on artists.
In one of the interventions, Apple Music was allowed to give its opinion. It was Elena Segal, Director of Music Publishing at Apple, who shed some light on the matter in the ranks of the Big Apple:
We compete with the free. We have been competing with free, whether legitimate or illegitimate, since the beginning of iTunes… and competing with free is always very difficult because consumers have the option to go free… I don't think an ad-supported service can generate enough revenue to support a healthy overall ecosystem.
From Apple and other large companies ensure that the music royalty business from streaming music services is on the tight side. Especially considering that a large part of the money stays in the record companies and little reaches the artists. In fact, according to the latest statistics published by The Trichordist shows that Apple Music is one of the best-paying services for artists, accounting for 25% of all streaming revenue at just 6% of consumption.
Solutions for the future ... without much intention to change
Finally, the Committee has concluded that to improve the musical royalties to the artists they have to change some aspects intrinsic that music services have at their core. These solutions are based on five large blocks:
- Equitable remuneration
- Income parity for songwriters
- Conducting a study on market power in the music industry
- Fair and transparent algorithms and playlists
- Address concerns about government protection of the artist
We will see how important these reflections from the UK government are. In fact, throughout the committee's interventions, hints have been made urging the United States and Europe to take charge of the matter in their territories.