November 27, 2021

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Paul McCartney Calls for Streaming Royalty Reform


The letter, backed by the Musicians’ Union and U.K. songwriters and composers body The Ivors Academy, is also signed by Bob Geldof, Boy George, Noel Gallagher, Damon Albarn, Jimmy Page and Kate Bush.

It comes amid a U.K. Parliamentary probe into the streaming business that has seen major labels’ dominance of the market emerge as a central issue. The inquiry, which is being led by the Digital, Culture, Media, and Sport (DCMS) Committee, is looking into the economic impact music streaming is having on artists, record labels and the wider music industry.

The first stage of the inquiry concluded March 22 with government minister Caroline Dinenage saying she would support a referral of the three biggest music companies — Universal Music, Sony Music and Warner Music — to the CMA.

Roughly two-thirds of Spotify’s share of global streams in 2020 came from music distributed by the major record labels, according to written testimony by Spotify. (Apple told the committee that close to 75% of music its customers listen to comes from major labels.)

The addition of world-famous names like McCartney and Martin to the artists’ cause ramps up the pressure on the British government to act and comes as the DCMS committee prepares its final report based on witness testimony and more than 200 written submissions from the likes of BMG, IFPI, Beggars Group and Hipgnosis Songs Fund.

The committee expects to deliver their report to government ministers next month, sometime after the Queen’s speech on May 11, although a date has not been announced. Ministers will then have eight weeks to respond, and although they aren’t obliged to enact its recommendations, they are expected to engage with them.

As part of the inquiry, the DCMS called the U.K. bosses of all three majors to testify. They faced hostile questioning from committee members over how labels pay out streaming royalties to creators.

Senior execs from Spotify, Amazon Music, Apple Music and YouTube also appeared before members. So too did recording artists Nile Rodgers, Radiohead’s Ed O’Brien and British singer-songwriter Nadine Shah, who argued for reform of the streaming business.

One of the key reforms musicians are pressing for is a change in the 1988 Copyright, Designs and Patents Act, which would see music streaming classified as akin to radio and TV broadcasting in the U.K. If that were to happen, streaming would be subject to the principle of equitable remuneration, which guarantees royalties to performers on recordings.

Currently, music streams are covered in most international markets by a ‘making available right,’ meaning that only the copyright owner receives payment, which it then shares with the featured artist according to the terms of their contract. Session musicians do not typically receive a share of streaming royalties, unlike U.K. television and radio royalties.

The major labels strongly oppose any change to copyright law around how streaming is classified. In evidence submitted to the DCMS inquiry, the labels said that a move towards equitable remuneration would result in a substantial loss of earnings, reducing their ability to invest in new acts. It could also hamper the ability of rights holders to negotiate licensee agreements with streaming services, they say, by making it harder for them to walk away from negotiations.

U.K. labels trade body BPI says TV and radio broadcasting, which is licensed under equitable remuneration in the U.K., generated £85 million ($110 million) in 2019, compared to £628 million ($812 million) from streaming. “Accordingly, whilst the artist may receive a bigger share under that regime,” Sony Music said in a written submission, “it would be a bigger share of a much smaller pie.”

British music creators groups disagree, however, and are calling for tighter regulation of the streaming business “to ensure the lawful and fair treatment of music makers.”

“We must put the value of music back where it belongs,” they write in their letter to Johnson — “in the hands of music makers.”

Read the full letter here:

Dear Prime Minister,

We write to you on behalf of today’s generation of artists, musicians and songwriters here in the UK.

For too long, streaming platforms, record labels and other internet giants have exploited performers and creators without rewarding them fairly. We must put the value of music back where it belongs – in the hands of music makers.

Streaming is quickly replacing radio as our main means of music communication. However, the law has not kept up with the pace of technological change and, as a result, performers and songwriters do not enjoy the same protections as they do in radio.

Today’s musicians receive very little income from their performances – most featured artists receive tiny fractions of a US cent per stream and session musicians receive nothing at all.

To remedy this, only two words need to change in the 1988 Copyright, Designs and Patents Act. This will modernise the law so that today’s performers receive a share of revenues, just like they enjoy in radio. It won’t cost the taxpayer a penny but will put more money in the pockets of UK taxpayers and raise revenues for public services like the NHS.

There is evidence of multinational corporations wielding extraordinary power and songwriters struggling as a result. An immediate government referral to the Competition and Markets Authority is the first step to address this. Songwriters earn 50% of radio revenues, but only 15% in streaming. We believe that in a truly free market the song will achieve greater value.

Ultimately though, we need a regulator to ensure the lawful and fair treatment of music makers. The UK has a proud history of protecting its producers, entrepreneurs and inventors. We believe British creators deserve the same protections as other industries whose work is devalued when exploited as a loss-leader.

By addressing these problems, we will make the UK the best place in the world to be a musician or a songwriter, allow recording studios and the UK session scene to thrive once again, strengthen our world leading cultural sector, allow the market for recorded music to flourish for listeners and creators, and unearth a new generation of talent.

We urge you to take these forward and ensure the music industry is part of your levelling-up agenda as we kickstart the post-Covid economic recovery.

Yours sincerely,

Damon Albarn OBE
Lily Allen
Wolf Alice
Marc Almond OBE
Joan Armatrading CBE
David Arnold
Massive Attack
Jazzie B OBE
Adam Bainbridge (Kindness)
Emily Barker
Gary Barlow OBE
Geoff Barrow
Django Bates
Brian Bennett OBE
Fiona Bevan
Aflie Boe OBE
Billy Bragg
The Chemical Brothers
Kate Bush CBE
Melanie C
Eliza Carthy MBE
Martin Carthy MBE
Celeste
Guy Chambers
Mike Batt LVO
Don Black OBE
Badly Drawn Boy
Chrissy Boy
Tim Burgess
Mairéad Carlin
Laura-Mary Carter
Nicky Chinn
Dame Sarah Connolly DBE
Phil Coulter
Roger Daltrey CBE
Catherine Anne Davies (The Anchoress)
Ian Devaney
Chris Difford
Al Doyle
Anne Dudley
Brian Eno
Self Esteem
James Fagan
Paloma Faith
Marianne Faithfull
George Fenton
Rebecca Ferguson
Robert Fripp
Shy FX
Gabrielle
Peter Gabriel
Noel Gallagher
Guy Garvey
Bob Geldof KBE
Boy George
David Gilmour CBE
Nigel Godrich
Howard Goodall CBE
Jimi Goodwin
Graham Gouldman
Tom Gray
Roger Greenaway OBE
Will Gregory
Ed Harcourt
Tony Hatch OBE
Richard Hawley
Justin Hayward
Fran Healy
Orlando Higginbottom
Jools Holland OBE, DL
Mick Hucknall
Crispin Hunt
Shabaka Hutchings
Eric Idle
John Paul Jones
Julian Joseph OBE
Kano
Linton Kwesi Johnson
Gary Kemp
Nancy Kerr
Richard Kerr
Soweto Kinch
Beverley Knight MBE
Mark Knopfler OBE
Annie Lennox OBE
Shaznay Lewis
Gary Lightbody OBE
Tasmin Little OBE
Calum MacColl
Roots Manuva
Laura Marling
Johnny Marr
Chris Martin
Claire Martin OBE
Cerys Matthews MBE
Sir Paul McCartney CH MBE
Horse McDonald
Thurston Moore
Gary “Mani” Mounfield
Mitch Murray CBE
Field Music
Frank Musker
Laura Mvula
Kate Nash
Stevie Nicks
Orbital
Roland Orzabal
Gary Osborne
Jimmy Page OBE
Hannah Peel
Daniel Pemberton
Yannis Philippakis
Anna Phoebe
Phil Pickett
Robert Plant CBE
Karine Polwart
Emily Portman
Chris Rea
Eddi Reader MBE
Sir Tim Rice
Orphy Robinson MBE
Matthew Rose
Nitin Sawhney CBE
Anil Sebastian
Peggy Seeger
Nadine Shah
Feargal Sharkey OBE
Shura
Labi Siffre
Martin Simpson
Skin
Mike Skinner
Curt Smith
Fraser T Smith
Robert Smith
Sharleen Spiteri
Lisa Stansfield
Sting CBE
Suggs
Tony Swain
Heidi Talbot
John Taylor
Phil Thornalley
KT Tunstall
Ruby Turner MBE
Becky Unthank
Norma Waterson MBE
Cleveland Watkiss MBE
Jessie Ware
Bruce Welch OBE
Kitty Whately
Ricky Wilde
Olivia Williams
Daniel “Woody” Woodgate
Midge Ure OBE
Nikki Yeoh



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