The CMA will ask whether the music streaming market is working
well for music lovers, as part of a study launched today.
Streaming has changed the way we listen to music. In the UK, more
than 80% of recorded music is now listened to via a streaming
service rather than using traditional physical media like CDs and
vinyl.
Linking the creators making the music and the fans listening to
it through a streaming service is a complex network of companies
that help make, promote and distribute recorded music.
The Competition and Markets Authority’s (CMA) study will examine the music
streaming market, from creator to consumer, paying particular
attention to the roles played by record labels and music
streaming services.
As part of its assessment of how well the market is working for
audiences, the CMA will consider whether innovation is being
stifled and if any firms hold excessive power. The CMA’s study will help
build a deeper understanding of how firms in the market influence
listeners’ choices and experiences.
While focussing on potential harm to consumers, the CMA will also
assess whether any lack of competition between music companies
could affect the musicians, singers and songwriters whose
interests are intertwined with those of music lovers.
If the CMA finds problems, it will consider what action may be
necessary.
Andrea Coscelli, Chief Executive of the CMA, said:
Whether you’re into Bowie, Beethoven or Beyoncé, most of us now
choose to stream our favourite music.
A vibrant and competitive music streaming market not only serves
the interests of fans and creators but helps support a diverse
and dynamic sector, which is of significant cultural and economic
value to the UK.
As we examine this complex market, our thinking and conclusions
will be guided by the evidence we receive.
The CMA is committed to fostering effective competition in
digital markets and is working in a number of areas to achieve
this goal. Its work includes investigating Google’s ‘privacy
sandbox’, Facebook’s use of ad
data and Apple’s AppStore. The
CMA has also begun a market study of mobile ecosystems as
well as launching the Digital Markets Unit
in April 2021 - which is operating in shadow form pending
legislation that will provide it with its full powers. An
independent CMA Inquiry Group is also separately investigating
Sony’s completed acquisition
of ‘artist and label’ services provider AWAL.
The market study takes
place in parallel to a wide range of work being done by the
government in these markets. While the CMA’s work will focus on
competition issues, it will maintain a coherent approach with
other related work including initiatives being undertaken by the
Department for Digital, Culture, Media & Sport, the
Intellectual Property Office and the Centre for Data Ethics and
Innovation.
The CMA now welcomes comments
on any of the issues raised in its Statement of Scope and the
accompanying Market Study Notice from consumers, businesses
and other interested parties.
Notes to editors
- Market studies examine why particular markets may not be
working well for consumers. They may lead to a range of outcomes,
including: a) making recommendations to the government to change
regulations or public policy; b) encouraging businesses in the
market to self-regulate; c) taking consumer or competition law
enforcement action against firms; d) making a reference for a
more in-depth (phase 2) market investigation; e) “clean bill of
health”.
- A market study formally begins with the publication of a
Market Study Notice by the CMA.
- The CMA must within 12 months of publication of a market
study notice publish a market study report setting out its
findings and the action (if any) it proposes to take.
-
Letter from Andrea
Coscelli to Julia Lopez MP, Julian Knight MP and George Freeman
MP on music streaming. Further correspondence between the
CMA and
the government regarding music streaming.
- More information on the CMA’s approach to market studies can
be found on the Market studies and
investigations - guidance on the CMA’s approach: CMA3 guidance
page.
- According to BPI –
the British recorded music industry’s trade association –
streaming now accounts for 83% of UK music consumption.
