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Music creatives call on government to push for more digital music transparency

By Chris Cooke | Published on Wednesday 1 March 2017

The key trade organisations for the music creative community and their managers yesterday called on UK politicians to help artists, songwriters and record producers secure more clarity on how their work is being exploited by the booming streaming market. The call follows efforts over the last eighteen months to secure a voluntary agreement on issues like transparency with the major music companies, and came as MPs raised concerns in a wide-ranging debate on intellectual property in Westminster.

Efforts to secure a voluntary code of conduct that could be embraced by all record companies, music publishers, artists, songwriters, producers and managers were led by Music Managers Forum director Andy Edwards. The aim was to secure an agreement on transparency, clarity and an alignment of interests for everyone involved in creating, recording, marketing, distributing and exploiting recorded music.

Edwards liaised with trade bodies allied to UK Music – and the three music majors directly – on the project, and says all parties played their part in the negotiations. And the process helped all sides better understand other groups’ issues and concerns.

Though, in a blog post about the project published earlier this week, Edwards confirmed: “After almost eighteen months and an awful lot of calls, coffee meets, confidential chats and boardroom debates the project finally came to an end when it became clear that it would be impossible to reach a consensus at this time”.

The lack of transparency around the deals done between labels, publishers, collecting societies and the streaming services was the single biggest issue raised during phase two of the Music Managers Forum’s ‘Dissecting The Digital Dollar’ project, undertaken by CMU Insights last year.

Managers said that they and their artists were too often left in the dark about the specifics of the streaming service deals, and how digital royalties were being calculated and processed. As a result artists couldn’t properly audit or understand their digital income, nor could they make informed decisions as to which streaming platforms they should be personally backing.

The lack of transparency also contributes to some artists and songwriters publicly slating the big streaming platforms. They might be right to do so, or their problems may actually lie with what happens to their digital royalties as they flow through the industry. Either way, it’s bad messaging when the record industry’s future is now so dependent on the premium streaming services succeeding.

The transparency issues in digital music – a big talking point at music industry conferences for a while now – have already appeared on the political agenda, in the UK and elsewhere. The European Copyright Directive includes an article trying to provide music creatives with more information about how their work is exploited in the digital domain, and Liberal Democrat Lord Tim Clement-Jones raised the issue during the Digital Economy Bill debates in the Lords last month.

Yesterday morning MPs took part in a debate on intellectual property at Westminster Hall. It was a wide-ranging discussion covering a multitude of piracy and other IP issues. The recent voluntary agreement reached between the music and movie industries and the big search engines was also widely welcomed, and the role of the government’s Intellectual Property Office in securing that was commended.

To that end Nigel Adams MP, who chairs the All Party Parliamentary Group on Music and who had instigated yesterday’s IP discussion, suggested that the IPO might now play a similar role in securing agreement within the music community on transparency. Acknowledging the attempts to secure a voluntary code of conduct, he said: “I understand that a previous attempt by creator groups to reach a deal on streaming revenues with the industry went through seventeen drafts over almost two years and ultimately ended in stalemate”.

Addressing the recently appointed IP Minister Jo Johnson, Adams continued: “Given that, if the minister committed the government to similar work to facilitate action on this issue as they undertook for the search engine code of practice, I would happily congratulate him immediately”.

Various other MPs taking part in the debate raised the transparency issue – many also commending the indie labels’ Fair Deals Declaration as an initiative that has already made progress in this domain – though it was Northern Irish MP Ian Paisley who spoke most strongly about the need for more transparency for music creatives.

He argued that new technology in music delivery should actually be making things more rather than less transparent for artists and songwriters, while proposing that – with Brexit ahead – now was the time to make UK copyright laws the most effective for both corporate rights owners but also, crucially, creators and performers.

Paisley told the debate: “As the technology modernises, so too the chain of payments should be made transparent. As we move towards Brexit, I urge the government to make the United Kingdom the gold standard for protection of performers’ IP. It is essential that we do that, to grab this generational opportunity to make the UK the best and the safest place for IP to be placed, contracted and protected. That would benefit performers and drive the industry, and would see that billion-pound industry grow. That is what we really want to see”.

Five music industry groups representing music creatives and their managers – BASCA, FAC, MMF, MPG and MU – yesterday put out a joint statement, welcoming the political support for artists and songwriters seeking more clarity. They also backed Adams’ suggestion that – given efforts within the music industry to secure commitments from the majors had failed – the government may now want to get involved in the discussions.

The statement was as follows…

For the past eighteen months, representatives of artists, songwriters and producers have worked to attempt to establish a simple code of conduct for the recorded music industry focusing on the principles of transparency, clarity and alignment of interests. Despite much patience and many concessions, these efforts have been in vain due to intransigence on the part of the major music corporations.

We therefore welcome the acknowledgement of Parliamentarians that intervention is required to guarantee greater clarity to music-makers – and ensure that a fairer share of the commercial growth from services that use our music goes back to the artists, songwriters and producers that created it.

According to data from UK Music, it is this country’s creative talent that underpins our global success story in music. The direct economic contribution of those who compose, perform and produce music represents over 50% of our entire industry’s GVA – more than £2.1 billion. Without these individuals there would be no music business.

These facts are worth bearing in mind in the continued debates around streaming services, and the fight by creators to see greater transparency in how their music is licensed and how the resulting revenues are distributed.

This has been an issue of internal industry discussion for some time, and we are therefore delighted that UK politicians are recognising the challenges faced by our members with the continued secrecy surrounding commercial licensing deals. The EU has accepted the need to legislate for transparency and it is imperative that the UK government commits to introduce back-stop powers in the event of Brexit.