MORE DEBATE NEEDED – IMPALA RESPONDS TO DEEZER AND UMG’s PROPOSAL ON STREAMING AND POINTS TO OWN PLAN TO BOOST DIVERSITY AND IMPROVE REVENUES FOR ALL ARTISTS
Brussels, 15th September 2023
Last week, Deezer and UMG announced their proposal to reform the streaming market through a so-called “artist-centric” model which seeks to change the way streaming royalties are allocated. At the same time, IMPALA held its AGM in Vienna, where streaming reform and maximising revenue for artists were flagged as key priorities.
Efforts to grow the debate about how to reform the streaming market are welcomed by IMPALA. It is encouraging that certain aspects of the recent proposals from Deezer and UMG chime with IMPALA’s own ten steps to make the most of streaming. IMPALA’s proposals were initially published over two years ago and revisited earlier this year (see our full plan and infographic).
In response to questions that have come up within its membership, however, IMPALA is seeking more clarity on the Deezer proposal, such as mechanisms for a boost in royalties to artists who meet certain thresholds, as well as other aspects.
The concerns raised include whether the proposal could lead to a possible two-tier approach impacting the work of independent labels who account for 80% of new releases (including artists patiently awaiting discovery, artists who deliberately cater to niche audiences, artists from smaller territories and newcomers just embarking on their artistic journey), as well as label decisions on which services they choose to deal with.
The fact that the Deezer proposal has been developed in a vacuum with the market leader instead of the sector generally is also a concern. Unless other stakeholders agree, IMPALA doesn’t see how it could apply outside of UMG repertoire.
Deezer’s engagement on the fight against streaming fraud is welcome as that plagues the industry and diverts revenues away from artists and creators. Increasing the value of music and elevating diversity are core to IMPALA’s streaming plan, and we appreciate that similar aims are shared by Deezer.
IMPALA has discussed its ambition with multiple streaming services to achieve meaningful streaming reform and looks forward to continuing this engagement to boost the debate.
Mark Kitcatt, Co-owner and MD of Everlasting Popstock, Chair of IMPALA’s streaming reform group commented: “IMPALA welcomes moves to propose reform in the market and IMPALA’s plan also seeks to achieve elements of differentiation as well as combat streaming manipulation. Our plan aims to elevate diversity and make it more commercially attractive, as already discussed with various services. Our goal is to realise the untapped potential of the streaming market. IMPALA aims to explore this further with Deezer and indeed all digital services.”
IMPALA’s Executive Chair Helen Smith commented: “We appreciate Deezer’s commitment to improve the streaming market. It will be interesting to see the modelling and understand if this has been discussed with other stakeholders, as well as with regulators. The gap between bigger and less streamed artists should be addressed and our plan sets out a number of different ways to achieve that. If Deezer’s approach were to create a two-tier market that would have a negative impact on our members, that would not be good for diversity”.
IMPALA members have also flagged that some of the language employed in the press in reaction to Deezer’s proposal is clearly unfortunate. The sector is concerned in particular with the use of the term “independent” which has been wrongly used to refer to bad actors trying to game the system.
Mark Kitcatt, continued: “It’s a common thread through the history of recorded music that the great artistic advances and changes have come from, and through, the independent sector. I don’t expect Goldman Sachs to know that but Deezer and UMG certainly do and we hope that services will join with us to reform the streaming world in a way that increases opportunity and reward for all dedicated music creators, and enhances and enriches the experience for fans, rather than just diverting more royalties towards the biggest artists”.
IMPALA’s Helen Smith concluded: “More debate is needed on this vital question and we look forward to further discussions to clarify the specifics of the Deezer proposal and its potential impact on the music ecosystem before commenting further. In the meantime, it can only apply to UMG repertoire unless or until other licensors were to agree, and we invite all interested parties to read IMPALA’s plan and let us have their views.”
IMPALA was established in 2000 and now represents nearly 6000 independent music companies. 99% of Europe’s music companies are small, micro and medium businesses and self-releasing artists. Known as the independents, they are world leaders in terms of innovation and discovering new music and artists – they produce more than 80% of all new releases and account for 80% of the sector’s jobs. IMPALA’s mission is to grow the independent music sector sustainably, return more value to artists, promote diversity and entrepreneurship, improve political access, inspire change, and increase access to finance. IMPALA works on a range of key issues for its members, runs various award schemes and has a programme aimed at businesses who want to develop a strategic relationship with the independent sector – Friends of IMPALA.
IMPALA – Independent Music Companies Association
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