UK gov launches Apple Music, streaming industry inquiry

Back in the iPod days, things were so much simpler then.

Apple may have another skirmish to handle as the UK parliament begins an inquiry into music streaming, asking why the people who make the music get a pittance while service providers take 30% and labels take the rest.

It’s a reasonable question

It’s not a ‘beat up on Apple’ argument of course – I’m under the impression it pays artists a little more than other services, but the fact that the people who make the music we love get paid so little should stick in the craw of any fan.

The UK’s Digital, Culture, Media and Sport Committee writes:

“Streaming has changed the music industry – but do the economics of music streaming work for everyone? We’re launching an inquiry into the economics of music streaming today and want to hear from you.”

What the inquiry is saying

“With streaming currently accounting for more than half of the global music industry’s revenue, this inquiry will look at the business models operated by platforms such as Spotify, Apple Music, Amazon Music and Google Play. Music streaming in the UK brings in more than £1 billion in revenue with 114 billion music streams in the last year, however artists can be paid as little as 13% of the income generated.”

The inquiry won’t just be looking at music streaming services, it will also be exploring how the industry should fight against music piracy – though given creatives get paid so little, it’s arguable there’s pirates on all sides in this.

The inquiry is inviting written submissions to be submitted by 6pm on Monday 16 November 2020, it is particularly seeking responses to the following questions:

• What are the dominant business models of platforms that offer music streaming as a service?
• Have new features associated with streaming platforms, such as algorithmic curation of music or company playlists, influenced consumer habits, tastes, etc?
• What has been the economic impact and long-term implications of streaming on the music industry, including for artists, record labels, record shops, etc?
• How can the Government protect the industry from knock-on effects, such as increased piracy of music? Does the UK need an equivalent of the Copyright Directive?
• Do alternative business models exist? How can policy favour more equitable business models?

More information is available here.

‘Algorithms are a blunt tool’

DCMS Committee Chair Julian Knight MP said:

“While streaming is a growing and important part of the music industry contributing billions to global wealth, its success cannot come at the expense of talented and lesser-known artists.

Algorithms might benefit platforms in maximising income from streaming but they are a blunt tool to operate in a creative industry with emerging talent risking failing the first hurdle.

We’re asking whether the business models used by major streaming platforms are fair to the writers and performers who provide the material. Longer-term we’re looking at whether the economics of streaming could in future limit the range of artists and music that we’re all able to enjoy today.”

What seems to me quite interesting is that Apple is not completely reliant on algorithms for its service, and with its Beats radio station and slightly more generous but could be better artist revenue split can argue that it already does something for smaller acts, but the inquiry will surely add weight to the ongoing pressure for Apple to reduce its cut beneath 30%.

These things tend to take a while, but should be one to watch given the importance of services to Apple’s outlook, moving forward.

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