UK competition watchdog to probe music streaming market

The competition watchdog first announced its intention to do so in October following a report on the economics of streaming by the UK Parliament’s Digital, Culture, Media and Sport Committee.

The report found that meagre returns to musicians from the current system are adversely affecting the creative ecosystem, and proposed several recommendations, one of which was that the CMA should decide whether or not to conduct a new market study into streaming and the power possessed by major music companies within the market.

The watchdog said it would be assessing whether the market is “working well for music consumers”. The study will interrogate the roles played by both record labels and music streaming services, and determine “whether innovation is being stifled”.

In addition to evaluating potential harm to consumers, the study will assess “whether any lack of competition between music companies could affect the musicians, singers and songwriters whose interests are intertwined with those of music lovers”.

Pending the outcome of the study, the CMA says it will determine the necessary steps to be taken, which could range from making recommendations to the UK government to change regulations or public policy, encouraging businesses in the market to self-regulate, taking consumer or competition law enforcement action against companies, or suggesting a more in-depth market investigation. The regulator is required to publish the market study report within a year.

“Whether you’re into Bowie, Beethoven or Beyoncé, most of us now choose to stream our favourite music,” CMA CEO Dr Andrea Coscelli said. “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.”

Meanwhile, the Copyright (Rights and Remuneration of Musicians) Bill in the UK is going through the House of Commons. If passed, it will introduce a right to equitable remuneration for music streaming, giving performers a right to receive a share of income outside of their label contracts and to reclaim ownership from record companies after 20 years.