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The top three record labels are operating “like a cartel” in the streaming age and the current system threatens the future of music in the UK, according to evidence provided on the first day of an investigation into the impact of streaming on the industry. musical. .
During the select committee on digital, culture, media and sports research on the economics of music streaming, MPs heard musicians such as Radiohead’s Ed O’Brien, Elbow’s Guy Garvey, and Gomez’s Tom Gray paint a grim image of artists struggling to survive.
Garvey said that “the system as it stands threatens the future of music,” while fair pay, increased transparency, and user-centric streaming models were proposed as ways to reshape the industry and make more fair for the artists.
Gray, who is the founder of the #BrokenRecord campaign, said that some artists were still tied to contracts that included outdated clauses, such as a 10% damages clause, which made labels work assuming 10% of CDs were sold. would break during transport.
Then, the participation of an artist is calculated from the remaining 90%, despite the fact that in the age of streaming hardly any CDs are sold. Tom Frederikse, a lawyer and former producer, who also gave testimony, said that in some cases the clause for damages reached 25%.
“What is very clear is that more than 70% of consumers think that artists are underpaid. As soon as someone sees this data and learns the terms of the payment agreement, they all come to the same conclusion: it’s not right, ”Gray said.
After hearing the evidence, Julie Elliott MP said it sounded as if the three major labels – Warner Brothers, Sony and Universal – were operating “like a cartel” due to what Gray called “suspiciously similar” artist contracts.
Gray referred to a recent YouGov poll that found that 77% of customers believed artists were not getting a fair deal, and reports that Universal posted revenue of $ 1.14 billion in the latest quarter despite the global pandemic and economic recession.
MPs heard that the huge profits made by major record labels were not being leaked to artists who, in the case of Nadine Shah, who also testified, were struggling to make ends meet in the streaming age. The broadcast was worth around £ 1 billion last year, yet the artists had been paid only 13% of the revenue generated.
The musicians said the artists had to adapt to a streaming model that had quickly replaced the system that existed when they were first hired.
O’Brien said that when Radiohead signed in 1991 there were big imbalances, but that the age of streaming had exacerbated them. “It is interesting to see your reaction to this morning’s testimony because you are realizing the injustice and opacity within the business, and then you are throwing yourself into this digital model. And it’s not working, ”he said.
Garvey said that Elbow had recently shortened a track’s intro to make it more likely to appear on playlists. Gray told the committee that genres like jazz and classical were struggling because their longer-length tracks don’t fit into the playlist system, which he says benefits easy listening and muzak.
Gray also told the committee that he had heard of cases where people who posted influential playlists on streaming platforms were paid to include tracks, which he called a modern form of “payola.”
The investigation continues and you will hear the “perspectives of industry experts, artists and record labels, as well as the streaming platforms themselves.” The chairman, MP Julian Knight, said the goal was to ask whether the business models used by major streaming platforms were “fair to the writers and performers who provide the material.”
