How a new campaign aims to fix a broken music industry

Tom Gray, of the band Gomez, is lobbying the UK government to regulate music streaming.

We are listening to more music than ever. In 2020, streaming, which counted for more than 80 per cent of all music consumption, was up 20 per cent on the previous year. But musicians aren’t seeing the financial benefits. One Spotify stream has an average value of around £0.004 – which goes to the label, or the song’s rights holders. An artist, if they have paid off debts to their label, might receive 20 per cent of that (according to a traditional 80/20 record deal), amounting to roughly £0.80 per 1,000 streams.

“There is a cultural delusion around the glamour of music which is for the most part portrayed and pushed by musicians themselves, in order to maintain the appearance of success,” said Tom Gray, a member of the Mercury Prize-winning band Gomez and a director of the Performing Rights Society, a music royalties collection organisation. “But even very ‘successful’ musicians and artists that you’ve heard of do not make enough money from recorded music to pay their rent.”

Touring used to be a way of promoting recorded music – vinyl, and then CD, sales. Labels have instead, in recent years, told their artists that it now works the other way round. “Musicians are told, ‘Hey, streaming is just the promotional tool. You’re gonna make your money on the road!’” said Gray. But for 11 months, live performances have been more or less non-existent due to the Covid-19 pandemic. How are musicians meant to earn a living now?

Gray studied politics at university and was considering pursuing a political career before he and his Gomez bandmates signed a record deal in 1997. Since last April he has run a campaign calling for urgent change to the structure of the music industry. He calls it Broken Record – after a hashtag he first used in a popular Twitter thread that kick-started the initiative.

Unusually, Broken Record is not a straightforward call to boycott Spotify, Amazon Music, Apple Music, Youtube and other streaming services, as previous campaigns have demanded. It is not directed at the tech platforms themselves, although they are an important part of the conversation. Instead, Gray is doing the work of a “political lobbyist” and calling upon the UK government to regulate the music industry. Alongside Keep Music Alive, a similar campaign organised last year by the Musicians’ Union and the Ivors Academy, Broken Record has played a crucial role in establishing an ongoing DCMS select committee inquiry into the economics of music streaming. Gray, as well as musicians including Guy Garvey, Radiohead’s Ed O’Brien and Nadine Shah, and representatives of the three major music label groups – Universal, Sony and Warner – have given evidence.

“This campaign is built to work in two directions,” Gray explained. “I want to use the conversation about regulation in the public, political sphere to put pressure on the industry to change itself. But I also want to push the boulder up the hill of actually changing British law.”

The problems are historic, Gray said, and lie in the “obnoxious” record deals that the three major groups have long offered artists. These labels remain the gatekeepers of the industry, and although the way most people listen to and pay for music has changed dramatically in the last 20 years, and labels’ production and distribution costs are now far lower than they were previously – passing digital files costs almost nothing compared with the price of printing and shipping vinyl – the major groups have not updated the terms of their deals to reflect this shift.

The market power of the “big three” has also led to streaming being considered as a traditional sale. “But a child can see that streaming is not sales,” said Gray. “You don’t keep it; there is no transaction. If you stop paying, you lose it. It’s a subscription.” If streaming was instead classed as rental, as Gray suggests it should be, it would function more like the music played on TV stations, in pubs, clubs and hairdressers, and would therefore count for equitable remuneration (royalties from licences) which, under precedent, pays 50 per cent to artists and 50 per cent to rights holders. That streaming services rely increasingly on algorithmic playlisting – where listeners do not choose what music is played – again suggests it is more comparable with radio broadcasting, which also pays artists and labels via equitable remuneration at a 50/50 split.

Gray is also lobbying for all streaming sites to switch to a user-centric payment model, a strategy that Soundcloud is reportedly preparing to introduce. Currently, most major streaming services use a “pro-rata” or “revenue share” model, which pools subscriber revenue together and distributes it to artists and rights holders according to which artists brought in the most streams. This means that the world’s most popular artists receive revenue from users who haven’t even listened to their songs. The biggest winners from this system are the three major groups, who together own the majority of all recorded music sold and streamed, both internationally and in the UK.

In a user-centric model, a user’s subscription is paid to the bands they listen to, redistributing some of the wealth from top-tier to lower-tier artists. The system also financially reconnects fans with their favourite musicians, offering a massive commercial opportunity – the sale of merchandise, concert tickets – for both artists and consumers.

Gray is “not hopeful” change will come soon, but said he is “a happy soldier”. He remains optimistic that in the Commons, champions for systemic change will come from both sides of the House. “There’s a lot more people than you realise who are fans of music,” he said. “A lot of the problems that face musicians are property rights – because it’s copyright, intellectual property – and that’s a classic conservative cause. Workers getting exploited is a left-wing cause. There is no side of the political spectrum where there is a reason not to support British creators over multinationals.”