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UK competition regulator outlines scope of market study into music streaming
By Chris Cooke | Published on Thursday 27 January 2022
The UK’s Competition & Markets Authority has formally launched its market study into the streaming music business, setting out the scope of that study, which is pretty wide-ranging.
A CMA study into the streaming music business was one of the proposals made by Parliament’s culture select committee at the end of its inquiry into the economics of streaming. The regulator then confirmed that it would indeed undertake such a study back in October.
Some sort of CMA study or investigation was mainly floated during the Parliamentary inquiry in the context of songwriter royalties.
Some argue that significantly more streaming money is allocated to recordings than songs because the majors dominate both the record industry and the music publishing sector, and – for various reasons around contractual conventions in the industry – it is in their interest to have more money flowing through their labels than their publishing divisions.
The majors deny this, of course, but many on the songwriter side have said that that is something the CMA should definitely look into.
In its announcement this morning, the CMA confirmed that its music streaming study will consider “the nature of competition at different levels of the value chain, including the extent to which music companies and music streaming services may have market power”, and also “the extent to which the publishing arms of recorded music companies strengthen any market power of such music companies”.
It will also consider a number of other issues too, though, including barriers to entry faced by music streaming start-ups; the specifics of the deals between the streaming services and the music companies; how the different streaming business models interact and compete; and “whether any business practices adopted by music streaming services (for example how they collect and use consumer data) may harm consumers, especially as more adopt music streaming”.
The CMA has already published a basic summary of how its sees music copyright and the music streaming business working, before running through a whole load of questions it is seeking to answer via this study. Interested parties now have until 17 Feb to make submissions.
Commenting on the study, CMA CEO Andrea Coscelli says: “Whether you’re into Bowie, Beethoven or Beyonce, most of us now choose to stream our favourite music. A vibrant and competitive music streaming market not only serves the interests of fans and creators but helps support a diverse and dynamic sector, which is of significant cultural and economic value to the UK. As we examine this complex market, our thinking and conclusions will be guided by the evidence we receive”.
The CMA study will be undertaken concurrent to various other government initiatives that came about as a result of the Parliamentary inquiry.
That includes working groups that are looking at contract transparency and music rights data, and Intellectual Property Office commissioned research into three proposed copyright law reforms that some argue would empower artists in the streaming domain, including equitable remuneration, a contract adjustment mechanism and reversion rights.
