CMA launches probe into music streaming market
UK competition watchdog launched a study this morning asking whether the music streaming market is working well for music lovers.
In the UK, more than 80 per cent of recorded music is now listened to via a streaming service rather than using traditional physical media like CDs and vinyl.
Linking the creators making the music and the fans listening to it through a streaming service is a complex network of companies that help make, promote and distribute recorded music.
This has completely reinvented the way consumers listen to music and artists make money.
The Competition and Markets Authority’s (CMA) study will examine the music streaming market, from creator to consumer, paying particular attention to the roles played by record labels and music streaming services.
As part of its assessment of how well the market is working for audiences, the CMA will consider whether innovation is being stifled and if any firms hold excessive power; it aims to help build a deeper understanding of how firms in the market influence listeners’ choices and experiences.
While focussing on potential harm to consumers, the CMA will also 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.
If the CMA finds problems, it will consider what action may be necessary.
Andrea Coscelli, chief exec of the CMA, said: “Whether you’re into Bowie, Beethoven or Beyoncé, most of us now choose to stream our favourite music.
“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.”
A spokesperson from the British Phonographic Industry (BPI), UK’s recorded music industry’s trade association, told City PM: “Streaming has led to an explosion of choice for music fans and creators in the UK. The BPI looks forward to engaging closely with the CMA to help it understand the changes that streaming has brought to the music market.”
The announcement comes alongside an ongoing discussions about the equity of music streaming. Late last year, Kevin Brennan MP introduced a music streaming Bill, which looked to reinvent the way artists were remunerated. It failed to make progress in House Of Commons in December.
Wider backdrop
The CMA has come down heavy on digital markets, with recent work including investigating Google’s ‘privacy sandbox’, Facebook’s use of ad data and Apple’s AppStore.
The CMA has also begun a market study of mobile ecosystems as well as launching the Digital Markets Unit in April 2021 – which is operating in shadow form pending legislation that will provide it with its full powers.
An independent CMA Inquiry Group is also separately investigating Sony’s completed acquisition of ‘artist and label’ services provider AWAL.
The market study takes place in parallel to a wide range of work being done by the government in these markets.
The CMA now welcomes comments on any of the issues raised in its Statement of Scope and the accompanying Market Study Notice from consumers, businesses and other interested parties.