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Business News CMU Digest
CMU Digest 05.03.23: US visa fees, TikTok, Universal Music, Tidal, Apple
By Chris Cooke | Published on Sunday 5 March 2023
The key stories from the last week in the music business…
A plethora of music industry groups called on the UK government to lobby the US Department Of Homeland Security over its proposal to increase visa fees for foreign performers. The proposal would see the cost of applying for a performer visa increase by more than 250%. Given the general surge in costs for musicians touring at the moment, that additional increase could make US tours unviable for many British artists. UK minister Julia Lopez previously said that it wasn’t for her government to “interfere in another country’s processes”. However, the new letter noted, “to suggest the UK government cannot work with the US to resolve this issue undermines the UK’s current approach to conducting state-level deals as potential precursor to a UK-US free trade agreement”. Business And Trade Secretary Kemi Badenoch was urged to put more pressure on her US counterparts to drop the proposed price hike. [READ MORE]
The political pressure continued to build on TikTok in both the US and Canada, where politicians continue to express concern that the Chinese government may have access to TikTok user-data via the app’s China-based owner Bytedance. The Foreign Affairs Committee in the US House Of Representatives approved proposed new laws that would make it easier for the American President to ban digital platforms that are shown to be providing data to, or pushing content for, the Chinese government. The proposals, which were only introduced into the House a week earlier, specifically mention TikTok and Bytedance. Up in Canada, the country’s government followed its US counterpart in banning its employees from using the TikTok app on work devices. Prime Minister Justin Trudeau said the move might prompt Canadians at large to “reflect on the security of their own data and perhaps make choices”. TikTok continues to deny there are any issues with data security on its platform. [READ MORE]
Universal Music boss Lucian Grainge again talked about the need to revamp the music streaming business model. This time he made the comments during an investor call discussing the major’s latest financial report which, in the words of CFO Boyd Muir, demonstrated that 2022 was “another year of sustained growth at UMG”. Nevertheless, Grainge said that the way streaming monies are currently shared out across the industry under-values the artists that drive consumers to the streaming platforms. In a memo to staff earlier this year, Grainge seemed most aggrieved that under the current model mood music and background noise uploaded to the digital services is treated the same as more conventional music releases for royalty purposes. Having already announced a partnership with Tidal to investigate alternative models for royalty distribution, Grainge told investors this week that the major is similarly working with Deezer on possible new approaches. [READ MORE]
Tidal announced that it was ending its direct artist payouts programme. The streaming firm first announced the programme in late 2021. It meant that, with the firm’s higher-priced $20 tier, Tidal paid a bonus to each subscriber’s favourite artist each month. The bonus came out of Tidal’s cut of the money and was in addition to any royalties the artist received via their label or distributor. Tidal boss Jesse Dorogusker said 70,000 artists signed up to the programme and $500,000 in direct payouts were made. However, he added, the programme didn’t have the impact the company had hoped and it now plans to put more money into its scheme supporting emerging artists instead. Tidal also recently confirmed that it was dropping the other innovation it announced in 2021, which was a plan to adopt a user-centric approach to paying royalties on that higher-priced tier. [READ MORE]
The European Commission sent another statement of objections to Apple over its App Store rules. The EC is investigating whether those rules breach European competition laws following a complaint by Spotify. The music streaming service – like many app makers – objects to an Apple rule that forces all in-app payments on iOS devices to use the tech giant’s own commission-charging transactions system and another that prevents apps from sign-posting alternative payment options online. EC investigators previously said that they also had concerns about both those App Store rules, however the new statement focuses exclusively on the second one, with the regulator confirming that previous communication from Apple has not allayed its concerns regarding the rule against sign-posting. Spotify et al want the EC to force Apple to change its rules on competition law grounds. [READ MORE]
