New industry working group to consider pay issues over music streaming

A new industry working group is set to consider how musicians and artists are paid through streaming – amid concerns over whether creators are paid fairly by sites.

The move was confirmed in a letter to the Commons Culture, Media and Sport Committee by Sir John Whittingdale, who said the new working group will “explore, develop and agree industry actions in relation to creator remuneration from streaming”.

The minister, who has responsibility for media, tourism and the creative industries, said the body will be “composed of representatives and experts from across the music sector, to explore and develop industry-led actions that support fair remuneration for existing and future music creators as part of a successful and globally competitive music industry”.

Dame Caroline Dinenage, who chairs the committee, welcomed the move by the Government.

Royalty rates in new recording contracts have long trended upwards, with average rates in new contracts now around 25% – while alternative deal types offer artists more options than ever to reach audiences and monetise their works, often with higher royalty rates than traditional record deals – Sir John Whittingdale

The parliamentary cross-party committee has long taken an interest in streaming and the impact on performers, with a report earlier this year suggesting the Intellectual Property Office establishes working groups on remuneration and performer rights to consider the current evidence and monitor developments in other countries.

But Dame Caroline said the group should not be a “talking shop”.

“The creation of a working group we have been calling for is a welcome step towards addressing the frustrations of musicians and songwriters whose pay falls far short of a fair level given their central role in the success of the music streaming industry,” she said.

“The Government must now make sure the group is more than a talking shop and leads to concrete change so the talented creators and performers we have in this country are properly rewarded for their creativity.”

In the letter, Sir John said there are also “many positives for the music streaming sector and the creators involved in it”.

“Royalty rates in new recording contracts have long trended upwards, with average rates in new contracts now around 25% – while alternative deal types offer artists more options than ever to reach audiences and monetise their works, often with higher royalty rates than traditional record deals,” he told MPs.

“Additionally, new contracts are increasingly moving away from life-of-copyright durations, in many cases allowing creators to regain control of their music after a shorter period. And these improvements come alongside increasing numbers of artists reaching substantial numbers of streams and being able to make a living from recorded music.”

But the body that represents UK record labels expressed concern about the “environment being fostered in the UK”.

Sophie Jones, the interim chief executive of the British Phonographic Industry, said she was worried about anything that would “disincentivise investment in our creative ecosystem at a time when labels are fighting hard to grow exports and protect the rights of artists in the era of AI”.

“This new effort seems at odds with the Government’s ambition to grow the UK’s world leading creative industries by an extra £50 billion by 2030.

“Over the past three years our sector has been subjected to multiple inquiries and investigations, culminating in a CMA market study that found competition is working effectively and delivering good and improving outcomes for consumers and creators across the sector.

“Throughout that process the BPI and its members engaged positively and constructively, resulting in a raft of initiatives to improve transparency and the flow of royalty payments to artists.

“Numerous studies have demonstrated that streaming has benefited consumers and artists alike, with record labels paying more to artists than ever before.” The Mail