Business News CMU Digest

CMU Digest 15.01.23: Universal Music memo, new energy support scheme, economics of streaming update, LIVENow, Harry Styles

By | Published on Sunday 15 January 2023

The key stories from the last week in the music business…

Universal Music boss Lucian Grainge told his staff in a start-of-the-year memo that the way streaming monies are shared out needs to be changed to what he calls an “artist-centric” model. Each streaming service currently allocates money to each track each month based on what percentage of the total number of plays across the platform it accounted for, with a play being counted at 30 seconds. Under that system, all tracks are treated equally, including things like relaxation music, background noise and generic kids songs, which in the physical era would have generally been sold on super cheap CDs. Makers of that content also often upload shorter tracks so that they get more plays in total. Many in the music community have criticised the fact the current system treats that content like any other music and that, as a result, said content takes a not insignificant cut of the money available. Grainge didn’t give much detail in this memo about how the system could be changed to favour what he sees as higher value music, but said his team would be pushing for changes of that kind this year. [READ MORE]

The live music and night-time sectors criticised the UK government’s newly announced plan to change the way it supports businesses facing surging energy costs from April onwards. Since October there has been a government subsidised energy price cap covering business usage. However, from April that will be replaced with a government subsidised discount on energy prices, which will provide significantly less support. Some sectors will benefit from a higher discount, mainly industrial and manufacturing sectors that have high energy consumption, but also things like libraries and museums. However, the higher level of support will not be available to venues and hospitality businesses of any size, despite UK Chancellor Of The Exchequer Jeremy Hunt acknowledging the impact high energy costs are having on small businesses and hospitality businesses in a letter to energy regulator Ofgem. The new plan was criticised by LIVE, the Night Time Industries Association and the Music Venue Trust, who all warned that it will result in further venues and clubs being forced to close. [READ MORE]

The UK Parliament’s culture select committee called for “more focus” on music-maker remuneration in the ongoing economics of streaming conversations. That committee published a lengthy report on the economics of music streaming in 2021 calling for a “complete reset” of the digital music business and proposing various reforms, including changes to copyright law. In response, the UK government’s Intellectual Property Office convened some committees and commissioned some research putting the spotlight on data issues, transparency issues and issues around music-maker remuneration. Voluntary codes are currently being negotiated around data and transparency to address some of the issues raised. However, on remuneration there has been research but no talks between industry stakeholders. In a new short update report, based on a hearing it conducted late last year, the select committee said that the IPO should establish “working groups on remuneration and performer rights to consider the current evidence base and monitor developments in other countries in these areas”. [READ MORE]

It emerged that UK collecting society PRS is suing livestreaming platform LIVENow. In its lawsuit, the society said that LIVENow has streamed a number of concerts – including the headline grabbing Dua Lipa livestream in November 2020 – without securing any licences covering the performance and streaming of the songs contained in those shows. PRS launched a specific licence covering livestreaming during the COVID-19 pandemic, when livestreamed concerts became a much bigger deal. At the time there was criticism within the music community about the development and specifics of that licence, but either way licences are required covering any songs performed in a livestream. PRS said: “For more than eighteen months, PRS For Music has positively engaged in licensing negotiations with LIVENow. These discussions remain unresolved and as such we have taken action to defend the rights of our members and songwriters of other societies”. [READ MORE]

Harry Styles went legal to try to stop the sale of unofficial merchandise. He filed a trademark infringement lawsuit with the US courts accusing various online operators of selling products that exploit his trademarks without licence. It can actually be quite hard to identify who those operators are because, as Styles’ lawsuit stated, “defendants attempt to avoid and mitigate liability by operating under one or more seller aliases to conceal both their identities and the full scope and interworking of their counterfeiting operation”. There is also a high chance they do not operate out of the US despite targeting consumers within the country. With that in mind, Styles’ lawsuit also seeks an injunction ordering online platforms like eBay, AliExpress, Alibaba, Amazon, Wish, Walmart, Etsy and DHgate to stop listing products that infringe the musician’s trademarks. [READ MORE]

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