Music streaming services: Singer-songwriters should earn a fair cut of the profits and a new Bill promises just that – Martyn McLaughlin

Fiona Bevan, a singer-songwriter who has worked with some of the biggest names in popular music over the past decade, recently spoke with pride when explaining to MPs how her writing skills had resulted in commercial success.

“I had a track on an album that was recently number one in the album charts in the UK,” she explained. “That was the fastest selling solo artist album of the year at the time of release.” The problem, however, is that the commercial success was not hers. “That track,” she added, “has earned me about £100.”

For musicians and songwriters across the country, the paucity of the revenue they receive from streaming services is a familiar concern, and one which is forcing them to make difficult compromises.

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A survey by the Ivors Academy and Musicians Union found that in 2019, some 82 per cent of professional musicals made £200 or less from streaming, with a mere seven per cent making £1,000 or more.

The fix at present is for artists to put down their instruments simply in order to pay the bills. “Right now,” Ms Bevan explained, “hit songwriters are driving Ubers.” But there is hope that a more lasting and fair solution to the lopsided economics of streaming is in sight.

Later this week, the Labour MP Kevin Brennan will lay down a private member’s bill at parliament designed to settle the issue once and for all.

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The overarching aim of the former shadow arts minister’s bill is to ensure that the revenue from streaming services moves onto a “common footing” with the revenue from other sources, such as radio play.

Streaming services have helped record companies enjoy rising profits in recent years, but some artists face hardship. (Picture: Carlos Alvarez/Getty Images)Streaming services have helped record companies enjoy rising profits in recent years, but some artists face hardship. (Picture: Carlos Alvarez/Getty Images)
Streaming services have helped record companies enjoy rising profits in recent years, but some artists face hardship. (Picture: Carlos Alvarez/Getty Images)

The mechanism to achieve that, known as equitable remuneration, will introduce a right to payment for performers on musical works that are made available to the public.

It would mean that whenever songs are played on streaming platforms such as Spotify or Apple Music, they are classified as a ‘rental’, and the artists receive a 50/50 split.

In Mr Brennan’s view, the step change would not only provide a much-need guarantee of earnings for those musicians hit hard by the pandemic’s impact on live performances, but bolster the industry as a whole.

“These reforms would lead to more new music, the revival of recording studios, a boost to the UK session music scene, the unearthing of a new generation of British talent, and Britain becoming once again a world-leading cultural hub for the recorded music industry,” he said.

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The legislation is being met with fierce resistance from the British Phonographic Industry, the trade body behind the Brit Awards which counts all three major record labels in the UK – Warner, Sony, and Universal – among its members.

It claims the legislation would “bind British music in red tape”, stifle investment by record labels, and “deny many of the next generation of artists their shot to build a career”. It is no surprise that such arguments are so forcefully made. It is the record companies, after all, who have the most to lose from Mr Brennan’s bill.

The reality is that even though the halcyon days of the music industry belong back in the era where physical media dominated, it is still in rude health, with the fears of digital piracy which arose at the turn of the millennium long since consigned to the past.

Global revenues hit nearly £16.2 billion last year, the highest since 2002, and the sixth consecutive year of growth. The previous year, record labels in the UK alone made £1.1bn.

Indeed, between 2015 and 2019, the revenues enjoyed by those labels grew by more than £200m, with the payments from steaming services alone more than offsetting the continued decline in sales from CDs and digital downloads.

Amidst such handsome profits, there is a deep-rooted structural inequality at heart of the streaming model, where the finer financial details are obscured by a slew of confidentiality clauses and non-disclosure agreements.

A great deal of criticism has been levelled in recent years at streaming services, and little of it could be said to be unwarranted. Under the current model, artists receive as little as £0.003p per stream via Spotify, with the sum only slightly higher – around £0.006p – via Apple Music.

Last year, as the pandemic first hit home, the former firm seemed to inadvertently concede that its payment model left artists scratching around to survive, thanks to its introduction of a ‘tip jar’ feature which allowed performers to accept donations.

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But the ire trained on firms like Spotify should not exclude the record companies themselves. For all the talk of A&R investment and marketing budgets, their arguments against Mr Brennan’s bill deliberately ignore key factors which have helped streaming services increase their profit margins. There has been, for example, a dramatic reduction in the costs incurred by these companies, with no need to manufacture and distribute millions of CDs.

Historically, that outlay accounted for the historic imbalance in how royalties were split which meant that artists and songwriters would receive a smaller slice of the pie. But that argument no longer holds water.

The record labels will talk of how some artists have enjoyed significant income via streaming, and while that is true, it applies only to a minority of established stars. A report published by the Intellectual Property Office in September found that the top one per cent of artists account for 80 per cent of all streams.

For Ms Bevan and others trying to make a living without being forced to drive taxis, the reality is altogether different. They will be hoping that MPs tune into their arguments.

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