HomeInsightsCompetition and Markets Authority publishes update paper on its market study into music and music streaming and consults on proposal to not make a market investigation reference

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The CMA has initially found that:

  • streaming has transformed the music industry; recorded music revenues reached £1.1 billion in 2021, with 80% of recorded music now listened to via streaming services; last year there were over 138 billion music streams in the UK;
  • listeners have access to a huge choice of music for a fixed monthly subscription fee; these fees have fallen in real terms;
  • access to a wide range of music, old and new, means older songs can more easily get a new lease of life and find new audiences; 86% of streams in 2021 were for music over a year old;
  • digitisation has made it easier than ever for many more artists to record and share music and find an audience; the number of artists streaming music has doubled between 2014 and 2020, from around 200,000 to 400,000;
  • while more artists are releasing music, and they have more choice than ever before as to how they release their work, the market remains challenging for many creators; the industry’s income is broadly stable, but more artists are offering more music; as has always been the case, while a small number of high-profile artists enjoy huge financial success, the large majority do not make substantial earnings;
  • against the backdrop of 138 billion overall streams in 2021, CMA analysis has found that one million streams per month could earn an artist around £12,000 a year; and
  • the three major record labels play a key role in the recorded music sector; the evidence the CMA has seen does not show that this concentrated market is currently causing consumers harm or that it is driving the concerns raised by artists; neither labels nor streaming services appear to be making sustained excess profits.

On balance, the CMA’s initial analysis indicates that the market is delivering good outcomes for consumers. However, the CMA would be concerned if the market changed in ways that could harm consumer interests. For example, it would be concerned if innovation in the sector decreased or if the balance of power changed and labels and streaming services began to make sustained and substantial excess profits.

The CMA’s market study is ongoing. In light of its initial findings, the CMA is consulting on its proposal to not make a market investigation reference and welcomes further evidence or feedback on this by 19 August 2022.

The CMA will share its analysis with the DCMS, the IPO and the Centre for Data Ethics and Innovation to help inform their work examining whether artists’ rights can be strengthened for music streaming.

In response to the CMA’s interim report, the CEO of the BPI, Geoff Taylor, commented: “We welcome the CMA’s preliminary findings, which have concluded that the streaming market is competitive, providing artists with more ways to release their music, and fans with more choice and value than ever before. We and our many and varied record label members are focused on investing in British artists, building their global fanbases, and sustaining the continued success of British music. We will continue to engage with the CMA and government to help ensure that the streaming market works to the benefit of artists, songwriters, record companies and fans”. To read the CMA’s press release in full and for a link to the update report, click here. To read the BPI’s response on its website, click here.