The Competition and Markets Authority (CMA), in an update document on its market assessment of streaming music, found the following:
The music industry has changed as a result of streaming.
Revenues from recorded music reached £1.1 billion in 2021, with streaming services accounting for 80% of all recorded music consumption.
Over 138 billion streams of music were made in the UK last year.
In exchange for a set monthly subscription price, listeners gain access to a vast selection of music. Real fees for these services have decreased.
Older songs can more easily find new listeners and a new lease on life thanks to access to a wide variety of music, both old and new.
In 2021, 86 percent of streams were for songs that were older than a year.
More musicians than ever before may now record, share, and find an audience for their music thanks to digitization.
Between 2014 and 2020, the number of musicians who stream their music more than doubled, from about 200,000 to 400,000.
Even though more musicians are making music and have more options than ever before on how to sell it, the market is still difficult for many artists.
Although the industry’s revenue is largely consistent, more musicians are releasing more songs.
As has historically been the case, the vast majority of well-known artists do not generate significant incomes, while a small number experience enormous financial success.
In 2021, there will be 138 billion streams total, and according to CMA estimate, an artist might make about £12,000 per year from one million streams.
The three major record labels are crucial to the industry of recorded music.
The data the CMA has reviewed does not support the assertions made by artists that this highly concentrated market is currently harming consumers or is the root of their worries.
Both labels and streaming providers don’t seem to be consistently making excessive profits.
Overall, the CMA’s preliminary review shows that the market is producing positive results for consumers.
The CMA would be worried, nevertheless, if market changes had a negative impact on consumers’ interests.
It would be concerned, for instance, if the industry’s level of creativity dropped or if the power dynamic shifted and labels and streaming services started generating steady and sizable excess profits.
The CMA will also keep supporting the Intellectual Property Office’s (IPO) efforts to increase information openness through collaboration with business.
Interim CMA Chief Executive Officer Sarah Cardell said:
Music has changed, thanks to streaming.
The availability of a wide variety of music, both old and new, at prices that have decreased in real terms is allowing many new musicians to find an audience.
However, many musicians still find the going tough and believe that they aren’t receiving a fair shake.
Our preliminary analysis demonstrates that factors related to competition, such as persistent high earnings, do not influence the outcomes for artists.
We now want to know your thoughts on our preliminary findings, since they will help shape our thinking and influence our final report.
Market research by the CMA is ongoing.
The CMA is seeking input on its recommendation not to reference a market inquiry in light of its preliminary findings and is open to additional information or comments by August 19.
The IPO, the Centre for Data Ethics and Innovation (CDEI), and the Department for Digital, Culture, Media & Sport (DCMS) will all get the CMA’s study in order to use it as a resource in their efforts to determine whether or not artists’ rights should be improved for music streaming.