UMG and Deezer to explore artist-centric streaming model

The collaboration will aim to develop new methods that holistically reward recording artists and songwriters for the value they create and to reimagine and update the engagement model for Deezer’s users and the artists they love.

“Deezer was one of the first platforms to commit to exploring alternative payment models to help assure artists are compensated fairly,” Deezer said. “This initiative underscores our continuous and unwavering commitment to advancing these efforts across its platform.”

The rise of subscription streaming services is the most significant development to occur in the music industry in decades, driving growth and opening opportunities for artists and fans around the world. While streaming has become the main method of consumption for music fans globally, the streaming remuneration model has not evolved commensurately in that time.

The new initiative between Deezer and UMG will seek to better align the interests of artists, fans and streaming services and explore ways in which artists from every genre and at every point in their career can benefit commercially from streaming.

With a foundation in deep data analysis, the partnership will look at the benefits and evaluate the viability of different economic models aimed at driving subscriber growth, forging stronger bonds with music fans on the platform and developing commercial opportunities that benefit artists and the broader music community.

Deezer says it is devoted to highlighting the value of music, artistic creation and fan engagement while continuously developing new ways of connecting artists with fans. Projects and features include super fan rewards, in-app live streaming and VOD concerts, alongside lyric translations, music quiz functionality and more. Alongside UMG, Deezer will gain insights that will inform future experiential features and monetisation options.

“As a key player in the music industry, we work with all labels to find ways to make the ecosystem fairer and help artists monetise their music better,” Deezer CEO Jeronimo Folgueira said. “The current system has clear issues that need to be addressed, such as increasing amounts of non-music tracks uploaded on platforms, poor quality covers with misspelt artists’ names and songs to ‘steal’ streams, and people trying to trick the system with the length of tracks.

“This hurts true artists, makes it harder for new ones to emerge and also damages the fan experience. We believe in quality and fairness at Deezer and with this initiative together with UMG we will look into how we can improve the model to everyone’s benefit. Music is extremely undervalued today and as part of the artist-centric discussion we are keen to find additional ways of increasing monetisation, to the benefit of real artists, the labels and platforms like Deezer.”

UMG executive vice-president and chief digital officer Michael Nash said: “Deezer has long advocated for a re-evaluation of subscription’s economic model. “We’re thrilled Jeronimo and his team are partnering with us to explore how we can evolve streaming for the benefit of the entire ecosystem of artists, labels, platforms and fans. Such collaboration is critical to the success of the artist-centric initiative. While there won’t be one uniform quick fix – subscriber acquisition and retention dynamics and metrics vary by platform – our partnership with Deezer will help accelerate this entire enterprise.”

In 2019, Deezer began to plan the launch of a pilot in France for its User-Centric Payment System (UCPS), envisioned to compensate musicians according to the number of direct plays they get from users. But the project was unsuccessful due to a low buy-in from music industry stakeholders, including labels, publishers and performance rights organisations.

In 2021, the National Music Centre (CNM) in France shared data on the impact of the UCPS, showing that switching to a user-centric model would reduce the royalties paid out to the rightsholders of the top 10 artists by 17.2%, giving them 7.7% of overall payouts rather than 9.3%. This would also lead to generally small but better percentage gains further down the hierarchy: artists ranked between 11 and 100 would gain an average 1.3%, those ranked from 101 to 1 000 would get a further 2.2%, and those between 1 001 and 10 000 would get an extra 0.5%.