Music streaming on digital platforms is changing the nature of work carried out by musicians. This has led to new questions about appropriate renumeration for musicians when their work is played on streaming platforms, as well as the impact and transparency of algorithmically driven recommendation systems on musicians’ livelihoods.

As part of Digit’s research focused on the creative and cultural industries, Professor David Hesmondhalgh has investigated the implications of these changes for musicians and rights-holders. He has worked directly with policymakers to provide a robust evidence base to inform the consideration of changes to policy and regulation.

In 2021, he co-authored a report for the UK Intellectual Property Office (IPO), Music Creators’ Earnings in the Digital Era, with Richard Osborne, Hyojung Sun and Kenny Barr. In 2022, he produced a literature review of the Impact of Algorithmically Driven Recommendation Systems on music Consumption and Production commissioned by the government’s Centre for Data Ethics and Innovation (CDEI).

Research questions

  • How have changes in the digital music marketplace impacted upon the earnings of music creators?
  • How do different stakeholders understand current issues regarding music creators’ earnings?
  • How is revenue from streaming distributed to music creators?
  • How have the levels, distributions and patterns of earnings changed over time?
  • How concentrated, or otherwise, is the distribution of earnings?
  • 30 semi-structured interviews with stakeholders.
  • A set of four focus groups with 25 musicians from a range of musical occupations and genres.
  • A survey of UK musicians commissioned from the market research company AudienceNet which received over 700 valid responses.
  • Streaming data purchased from the Official Charts Company (OCC) covering the years 2014-2020.
  • A set of anonymised music publishing and record contracts provided to us by the Musicians’ Union covering the years 1991-2019.
  • Anonymised sales and royalty information from a UK independent record company.
  • Data provided by the Performing Rights Society (PRS) and Mechanical-Copyright Protection Society (MCPS) on royalties paid to musicians.
  • Analysis of a vast range of publicly available sources from the last 50 years concerning the music industries.
  • A literature review of international research on music creators’ earnings and other related issues.
  • The earnings that UK-based performers and studio producers made from recording rights remained relatively stable in real terms between 2008 and 2019, and the earnings that composers and lyricists gained from music publishing rights increased by 11% in that period (accounting for inflation), though arguably from a very low historical base.
  • Average per-stream rates fell between 2012 and 2019, but revenues had risen substantially during this time, suggesting that the per-stream rates that are a feature of many complaints about music streaming provide only a limited perspective on remuneration issues.
  • Costs of manufacture and physical distribution declined drastically from 2000 but there is no evidence that the A&R and marketing costs borne by record companies had risen during the digital era, potentially challenging some of the claims made to justify the relatively high proportion of streaming revenues gained by the recording sector versus the publishing sector.
  • Revenues from recorded music constitute only a small proportion of music creators’ earnings; live music and teaching are by far the main ways in which musicians make a living from music.
  • The main issues determining musicians’ income from streaming concern how much revenue is collected by MSPs and how it is shared between MSPs, rights-owning companies and contracting musicians. Average ‘per-stream’ shares expressed in penny fractions gain attention but are pretty much meaningless compared with how much musicians earn in total.
  • A system whereby consumers pay either nothing for the music they stream via advertising-supported platforms) or very little if subscribing, is unlikely to be able to reward musicians better. As with cheap clothing, if consumers do not pay much, then it is difficult to see how musicians might earn substantial amounts.
  • Although there have been relatively small variations over time, MSPs retain around 33% of the revenue they collect; hardly anyone interviewed for the report felt this proportion was deeply unfair and/or that it should be substantially reduced in favour of rights-holding organisations and contracted musicians.
  • The pre-streaming system never provided substantial income for most musician-creators. The rise of MSPs and digital distributors has permitted vast numbers of musicians to enter the greatly expanded recorded music eco-system. But this seems principally to have led to a massive lengthening of the long tail: the number of artists achieving at least one UK stream in our sample month (October) had doubled between 2014 and 2020, from around 200,000 to 400,000.
  • Collecting society data provided to us also showed a large increase in the number of songwriters earning money from their compositions in the UK, from over 36,000 in 2009 to over 62,000 in 2019. Popularity however remains highly concentrated in the ‘head’ of the distribution curve: the data showed that the top 1% of tracks gained 75-80% and the top 1% of artists gained 78-80% of all streams in all Octobers between 2014 and 2020.

Engagement & Impact

Tim Moss, IPO’s Chief Executive and Accounting Officer, described the IPO report as “the most comprehensive study of music creators’ earnings ever completed in the UK”.

The IPO report informed the government’s response to the House of Commons Digital, Culture, Media and Sport (DCMS) Select Committee’s Report into the Economics of Music Streaming. The government wrote that the ILO report “provided invaluable insights into the streaming environment” and highlighted the need for further evidence.

The UK government’s Centre for Data Ethics and Innovation (CDEI) subsequently commissioned Professor Hesmondhalgh to produce a literature review of the Impact of Algorithmically Driven Recommendation Systems on Music Consumption and Production, which was published on 3 Feb 2023 alongside (and referenced in) the CDEI’s own report by the end of 2022.

The IPO report also informed the Competition and Markets Authority (CMA) review of fair competition in music streaming and was cited 17 times in their Music and streaming: Final Report, which was published in November 2022.

In December 2023, Professor Hesmondhalgh and a colleague gave oral evidence to the UK House of Commons DCMS Committee in Parliament on Creator Renumeration, which was reported in the Guardian and Music Week.

Related research 

In 2021 Professor Hesmondhalgh received an Advanced Research Grant of 2.5 million Euros from the European Research Council for his project MUSICSTREAM: Music Culture in the Age of Streaming. The project will run until November 2026. It features comparative research on how music streaming platforms are transforming cultural work across the world, with a focus on Europe and China.

David also supervises a number of PhDs that concern the pay and conditions of cultural workers internationally, including Aditya Lal’s work on the Indian recorded music industry, Richard ‘Gummo’ Clare’s research on musicians in the London Jazz scene, and Yuan Yao and Chengyao Liu’s dissertations on the impact of platforms on Chinese creative labour. 

Research outputs

Music Creators’ Earnings in the Digital Era
David Hesmondhalgh, Richard Osborne, Hyojung Sun and Kenny Barr (2021), Intellectual Property Office Report

Making sense of metrics in the music industries
Baym, N., Bergmann, R., Bhargava, R., Diaz, F., Gillespie, T., Hesmondhalgh, D., Maris, E. and Persaud, C.J. (2021), International Journal of Communication

Streaming’s Effects on Music Culture: Old Anxieties and New Simplifications
Hesmondalgh, D. (2021), Cultural Sociology

Researchers

University of Leeds

Hyojung Sun, Lecturer in the Business of Creative and Cultural Industries, University of York

Richard Osborne, Senior Lecturer in Popular Music, Middlesex University

Kenny Barr, Research Associate, University of Glasgow