The recent figures released by the British Phonographic Industry (BPI) have revealed a startling truth about the music industry. The figures show that major artists are now getting paid less than they were in 2007, despite the industry being worth more than ever before. This is a worrying trend that has many people concerned about the future of music and the impact it will have on the artists who make it.
The real question is though, is this necessarily a bad thing? Clearly the figures show more money, and more streams are going to more artists. In TMV’s view this is actually a good thing. It is clearly a reason why Sir Lucian Grange wants to discuss a different streaming model that will benefit artists signed to large major label’s as we outlined in our discussions in the article; ‘A Reply: Sir Lucian Grange & The Need for an Evolution of the Streaming Model – Part 2’.
The BPI figures show that the value of the UK music industry has increased by 70% since 2007, with total revenues reaching £1.1 billion in 2021. However, during this same period, the average income for a musician has actually decreased by 23%.
This means that despite the industry generating more money than ever before, the artists who create the music are not seeing a fair share of the profits and this is more the critical issue in our view. Are the labels receiving less revenue…highly unlikely!
We would state one of the main reasons for this decline in artist income is the shift towards streaming services. While streaming has made music more accessible to listeners than ever before, it has also had a negative impact on artist royalties. The amount of money that artists receive from streaming services is significantly lower than what they would earn from iTunes downloads and physical sales, such as CDs or vinyl records. This has led to a situation where artists are seeing their incomes decrease, even as their popularity and success continue to grow.
The BPI figures have sparked a debate about the future of the music industry and the role of streaming services in the modern music landscape. Some argue that streaming services are essential for the survival of the industry and that they provide a valuable service to both listeners and artists. Others believe that the current model is unsustainable and that major changes are needed to ensure that artists are fairly compensated for their work and TMV sit in this latter camp.
One proposed solution is to increase the royalty rates that streaming services pay to artists. This would help to ensure that artists are paid a fair share of the revenue generated by their music and would provide a much-needed boost to their incomes. Or alternatively the labels could pay through more of what they earn to artists – but is this likely to occur? One can hope, but yes, it is unlikely.
Whatever the solution, it is clear that the current situation is unsustainable for artists. Artists are the lifeblood of the music industry, and if they are not paid fairly for their work, the industry as a whole will suffer. It is up to all stakeholders in the industry, from record labels and streaming services to fans and listeners, to work together to find a solution that ensures that artists are fairly compensated for their contributions to the music we all love.
Yet the real question is how do you that, when you have the competing interests of large labels and publishers wanting streaming services to go back to the “good old days”. Back then performing rights societies would only do a manual survey of songs played one month every year which obviously and erroneously favoured major label artists over smaller artists in terms of royalty distributions.
With the growth of streaming and decline of radio being the key music listener distribution medium, streaming is here to stay for the long haul. The core issue is definitely royalty payment levels that find their way to actual artists. It is TMV’s view that both labels and streaming services need to come to the table to work out a way they each receive a little less so artists who are after all the creative force of the music industry can get a better slice of the royalty pie.