Competition & Markets Authority

The UK Government Calls On The Competition & Markets Authority To Open An Investigation Into The Music Streaming Market

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LONDON (CelebrityAccess) — Following the publication of a report on the economics of music streaming, the Government of the United Kingdom has called on the nation’s Competition & Markets Authority to launch a review of major record labels and their impact on the business of music streaming.

The publication of the report, which the UK government described as a ‘key moment for the music industry’ follows the publication of the report by the Culture Select Committee, which conducted a six month study of the streaming market and its impacts on songwriters and artists.

Committee chair Julian Knight conceded that while streaming has generated “significant profits to the recorded-music industry, the talent behind it – performers, songwriters and composers – are losing out.”

The committee called on the CMA to examine the leverage that major labels can exert on the system, and called for the markets watchdog to consider YouTube’s power in the streaming market.

In a statement provided to the BBC, the British Phonographic Industry (BPI), which represents the UK’s recorded-music industry, said their members would comply with any inquiry launched by the CMA.

“Should the CMA conduct a study, we look forward to detailing labels’ role in supercharging the careers of British talent within a complex and dynamic ecosystem,” it said.

In a statement provided to CelebrityAccess, IMPALA Executive Chair Helen Smith said:

Having a competitive, open and responsible music market is vital. As a sector, we have been raising concerns about increasing consolidation for decades. We have repeatedly flagged the need to have structural and remedial measures in place to address the consequences and ensure the music market is competitive and open. IMPALA welcomes the investigation by the CMA into concentration in the music market in the UK. As far as streaming is concerned, we have key recommendations for labels as well as services in our 10 point streaming plan. We also looked into equitable remuneration and concluded it is not equitable. Our view is that it would be damaging for emerging artists and would not actually introduce effective change.

Our members’ job as independent music companies is to maximize revenues for our artists and help diverse artists break through. Our members are inundated more than ever before by artists looking for label partners and we need the right conditions to take on these artists. Our vision is for a market full of opportunity and market access is crucial.


The digital music market is of course fundamental in today’s ecosystem. We have raised the question of competition in this sector too and the power of a handful of global digital players. Being indispensable trading partners comes with responsibilities. Our 10 point plan for streaming reform flags many of these issues. We believe for example that more needs to be done to maximise revenues for artists and to boost diversity.

We understand that this is to be the remit of the new Digital Markets Unit within the CMA. We would urge a clear investigation into these issues, including why the music market today still only represents 35% of its peak when adjusted for inflation, why the real subscription prices for music have actually gone down, the impact of the key factors exerting downward pressure on prices such as the value gap, an assessment of royalty reduction programmes such as Spotify’s Discovery Mode and whether the very structure of the digital market and key players is in the public interest. We would also urge the U.K. government to pursue a legislative response on the value gap and not fall behind the rest of Europe.

We look forward to working with the CMA, the Digital Markets Unit and the U.K. government on all these issues.

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