The time for the impossible is now
The year 2020 has been extraordinary, and, combined with this year’s political and cultural maelstroms, the pandemic has resulted in many deep and profound impacts.
For one, it’s brought home what is truly important — family, friends, community, health, politics.
It’s also forced a re-evaluation of our working environments, and inspired a drive towards change and improvement. We have had time to stop and think, instead of focusing so disproportionately on our self-obsessed meeting schedules, travel plans, social engagements and so on.
They say that there is nothing like a crisis to deliver clarity of thought and for me, personally, this is extremely true.
From a professional perspective, the band I manage, Biffy Clyro, started the year with clear-cut strategies to release and promote a remarkable album, alongside some extensive touring.
Coronavirus soon laid those plans to waste and then the new plans were changed repeatedly until we fixed on a schedule and decided we could change them no more. Like every other artist, Biffy’s shows have been rescheduled to 2021, and elsewhere we’ve pivoted into unforeseen territories — from a groundbreaking livestream at Glasgow Barrowland, partaking in a virtual Grand Prix, a Radio 1 Children In Need record, ‘Mon The NHS’ T-shirts and partnering with the fantastic charity Create to support the arts with a video to counter the Fatima cyber advert.
It’s been exhausting, challenging and stressful as we worked in a world of personal and professional uncertainty and fear. We were very fortunate that A Celebration of Endings reached number one in the UK - but elsewhere we’re still operating in a fog of uncertainty, and blind faith in the latest vaccine developments.
As Chair of the Music Managers Forum I’ve seen these impacts on a much wider scale, and been in meetings where the despair, confusion and distress has been palpable. I’ve spoken to managers who’ve lost practically all their income overnight, and whose artists and crews are relying on charity handouts. As freelancers and small businesses, far too many have slipped through the cracks of Government support — to the point where the MMF has actually created our own ReBuild fund for Managers.
I am also extremely concerned about the repercussions on mental health. Touring is not only how artists make their money. It is how they live their lives, it is about identity, validation, routine, structure, camaraderie, self-esteem and much more. I ask all labels and publishers to focus on this and ask yourselves if you are doing enough to safeguard the wellbeing of the artists you work with? If not, can you please address this urgently.
Even if gigs and festivals return tomorrow, the impacts of shutdown will stretch deep into 2021 and 2022 — as will the substantial reductions we expect in public performance revenues from PPL and PRS. Things may well get worse before they become better.
Fortunately, the recorded music sector, at least, has remained relatively immune to these traumas. Thanks to streaming, most record labels — and certainly the major labels — have grown their business through the pandemic. Locked down audiences have continued flocking to Spotify, Apple Music, Deezer and YouTube. Publishing catalogues are exchanging hands for ever-increasing sums.
For artists, songwriters, musicians and producers, this should be a cause for celebration as the business is growing. What they’ve lost on one hand, they should, in theory, be gaining on the other.
However, it’s becoming increasingly apparent that this is not happening. A substantial number of creators are facing the lose/lose situation of no live shows and no meaningful revenue from streaming either.
This is a dangerous disconnect. Most artists appreciate how streaming can help build them a global audience and they work closely with the DSPs to achieve this. However, the way in which DSP licensing deals and label contracts are constructed means too few have a stake in its financial success.
The lack of live activity and revenue has focused the minds and attention of managers and creators like never before on this area of the business.
This scenario risks cutting music creators adrift — music creators who, by the way, according to UK Music data, are responsible for almost half the industry’s total economic output — and is why the #BrokenRecord and #FixStreaming campaigns have struck such a chord, and why the “economics of streaming” will now be discussed at a DCMS Select Committee inquiry.
What began as a complex pan-industry discussion, is now being pushed into the full political glare.
The MMF welcomes the inquiry and has sent in a joint submission with our sister organisation, the Featured Artists Coalition. Having probed and explored this subject for five years with our Dissecting The Digital Dollar project, we feel we can offer constructive input — highlighting areas of dysfunction as well as potential solutions.
The Select Committee will hopefully make recommendations to Government that will help deliver artists and songwriters a fairer slice of the pie.
Clearly, there are areas where DSPs will have to adapt and change, however I also believe we need concerted and meaningful action from inside the industry itself, and specifically across 3 areas:
1. Contract reform
The dynamics of streaming are fundamentally different to the old-world, which means contracts based on “unit sales” risk being redundant in a market based increasingly on streaming. As a result, we need fundamental changes such as the writing-off of unrecouped balances after a set period of time, say 15 years, and a modern and fair artist royalty rate on all digital revenues. Anachronistic clauses such as packaging/technology deductions or controlled composition clauses should be consigned to history. Licencing deals and rights reversion after a fixed-period should be standard practice. Such changes would make a material difference to artists — and particularly those tethered to contracts from an analogue era.
2. Song Royalties
Collective licensing is one of the cornerstones of our business. However, as highlighted by the MMF’s $ong Royalties Guide, the inherent inefficiencies in how streaming revenues flow back to songwriters means that huge sums of money — and potentially millions of pounds — are not being properly allocated. Even worse, royalties due to the poorest songwriters are being reapportioned by market share to the pockets of the richest. This needs to be corrected as a matter of urgency, with action to reduce so-called “black box” collections and for genuinely unattributed revenues to be directed to artist education and artist-focused charities such as Help Musicians.
3. DSP licensing
Although the recorded market has changed radically over recent years, the basis of DSP licensing deals remains unchanged from the early 2000s. Which means any new entrant to the digital music market is effectively locked into a process of signing 3 upfront deals with the major labels for which they will pay large upfront advances and be tied under NDA to various usage clauses. Although artists are increasingly entering into “non-traditional” partnerships with labels — or bypassing labels altogether — they and their representatives still have little insight into these licensing partnerships. This, again, needs to change. Artists and their managers need far greater transparency over how licensing partnerships that directly impact their income are constructed.
Even in the pandemic, we are seeing these same issues recurring around new innovations like livestreaming, with discussions about rates and licensing taking place without consultation or oversight from artists and their representatives.
These proposals are not, in my view, radical.
They are not coming from left-field, and there are other issues which could be added to this list like user-centric payouts and ER.
The MMF’s Dissecting The Digital Dollar project has pinpointed systematic problems with how DSPs are licensed and how streaming revenues are distributed.
Meanwhile, progressive industry leaders have been advocating a fairer streaming contract between labels and artists, even before the pandemic — most notably Beggars Group founder Martin Mills, in a well-received speech delivered five years ago.
WIN issued their Fair Digital Deals Declaration back in 2014, while over recent months BMG have grasped the reformist mettle and announced the removal from artist contracts of highly controversial controlled composition clauses and packaging deductions.
These are all welcome starting points, but, because of the pandemic, we need to go faster and we need to go further.
It’s frequently stated that COVID-19 has accelerated certain pre-existing trends in our environment — for instance, the shift in consumer spending from local High Streets to online — and so it should be with these necessary changes around streaming.
To enter 2021 with a renewed sense of optimism, it is vital we reconnect artists and music makers with how their audiences are consuming music.
But the industry itself must take a lead in bringing change. The time for the impossible is now.
