Skip to main content

Home Music Music News

UK watchdog launches study to assess music streaming fairness for acts and fans

The Competition and Markets Authority may then confirm the need for a full investigation

By Charlotte Krol

A photo of different streaming apps on a phone
A photo of different streaming apps on a phone. Picture: Press

The UK’s competition watchdog has launched a study to determine whether the music streaming market is operating fairly and in need of a full competition investigation.

The Competition and Markets Authority (CMA) will assess whether major record labels such as Universal Music and leading streamers including Spotify hold “excessive power”, and whether artists and fans are getting a fair deal.

It’s based off findings from the Department for Digital, Culture, Media and Sport’s (DCMS) Economics Of Music Streaming inquiry last year in which cross-party MP stressed the need for a “complete reset” of operations to redress the “pitiful returns” that smaller acts receive.

The inquiry heard evidence from acts including Radiohead, Elbow and Nadine Shah. Last April, more than 150 artists including Paul McCartney and Kate Bush signed an open letter to Prime Minister Boris Johnson asking to help reform the streaming economy.

The DCMS has asked the CMA to launch an in-depth study to ascertain whether the music streaming market, which in 2021 accounted for 80 per cent of the UK’s £1.7 billion industry income, is fair and competitive. A full investigation may then be launched based off the findings.

Many artists have argued that they don’t receive a fair share of royalties from the streaming deals that they’ve signed up to in their record contracts. By contrast, in 2021 the world’s biggest record label Universal was floated at a £38 billion valuation, while Warner Music is now valued at more than (£16 billion).

“Whether you’re into Bowie, Beethoven or Beyoncé, most of us now choose to stream our favourite music,” CMA chief executive Andrea Coscelli said [via The Guardian]. “A vibrant and competitive music streaming market not only serves the interests of fans and creators but helps support a diverse and dynamic sector, which is of significant cultural and economic value to the UK.”

The CMA said that the market study, which will examine the streaming industry from “creator to consumer”, will pay particular attention to the power and influence of record labels and music streaming services.

“The CMA will consider whether innovation is being stifled and if firms hold excessive power,” it said. “The CMA will also assess whether any lack of competition between music companies could affect the musicians, singers and songwriters whose interests are intertwined with those of music lovers.”

It will also determine whether to take enforcement action against companies, to encourage industry self-regulation or to allow things to operate as they do now should the government legislate to improve the UK music market.

Coscelli added: “As we examine this complex market, our thinking and conclusions will be guided by the evidence we receive,. If the CMA finds problems, it will consider what action may be necessary.”

The Anchoress Press Photo
The Anchoress (Photo: Roberto Foddai)

Last December, Catherine Anne Davies, aka The Anchoress, strongly criticised streaming models in the music industry, saying that she failed to break even despite a hugely successful year in 2021.

The Anchoress’ second album ‘The Art Of Losing’ was released last March and received more than 750,000 online streams as well as critical acclaim. Regardless of its success, however, Davies said that she didn’t break even.

“If streaming numbers had been record sales, I would have got a gold record on my wall for ‘The Art of Losing’,” Davies told the BBC.

“But I’ve earned nothing, not a penny, because of the structure of my label deal. There was a small advance but it didn’t cover the cost of mixing.”