Updated: EU Referendum: the music biz reacts

European Union

The UK music business has woken up to a shock result in the EU Referendum, with the UK voting to Leave the European Union by a majority of 51.9% to 48.1%.

That’s in stark contrast to opinion within the business, which was heavily in favour of Remain. A Music Week Twitter poll showed 91% of respondents thought Brexit would be bad news for the UK music business, while a string of executives told Music Week of the possible business consequences of being outside the EU umbrella.

Many of those organisations and executives are still processing what last night’s result will actually mean. But record labels trade body the BPI has already issued a statement by its CEO Geoff Taylor, who had previously warned that the move could hit exports, copyright and the live business.

“The outcome of the EU Referendum will come as a surprise to many across the music community, who will be concerned by the economic uncertainty that lies ahead and the impact this may have on business prospects,” said Taylor in today's statement.

"However, the UK public has spoken, and once the short-term political and macro-economic consequences have played out, this decision will mean new priorities for the music industry in our work with Government. We will, of course, press the Government to swiftly negotiate trade deals that will ensure unimpeded access to EU markets for our music and our touring artists.

“Our Government will also now have the opportunity to legislate for stronger domestic copyright rules that encourage investment here in the UK and which will protect UK creators from piracy and from tech platforms siphoning off value through copyright loopholes. We are confident that British music will remain hugely popular across Europe and we will work hard to make sure UK labels are able to capitalise on that demand.”

Meanwhile, John Smith, general secretary of the Musicians Union, tweeted: “Totally stunned, horrified and saddened by #Brexit result. A bad day for internationalists and for the next generation.”

Beggars founder Martin Mills, who had urged staff to vote Remain ahead of the poll, sent an internal email entitled 'Lost for words' that read: "We’re stunned and saddened at the UK’s decision to leave the EU family. While we digest the consequences, we’d just like to re-assure you all that the Beggars family is, always has been, and always will be, international, with no frontiers. We will continue to find ways to flourish by bringing music and music lovers together across the world."

AIM CEO Alison Wenham issued a statement saying: “Following today’s result on Brexit, AIM will liaise closely with our members, other trade bodies and colleagues across the music industry to ensure that the strength and standing of the independent music community in the international marketplace is not diminished by these events.”

IFPI CEO Frances Moore said: "As an international recording industry, with businesses across all 28 EU Member States, the interest of our sector was for the UK to remain in the European Union. The decision of the UK to leave the EU creates a great deal of uncertainty which could last for a considerable time. In this difficult period, IFPI will continue to work hard to ensure that our members' interests are best represented on all the issues we deal with."

Joel Crouch, Eventbrite's general manager, UK and Ireland said: "Clearly, this was not a decision that anyone took lightly - in London alone, we spotted close to a hundred events on our platform where the EU referendum was being discussed in the run up to the vote. Like any other business, we cannot predict the precise impact of this outcome both on our company and the wider events industry in Britain, simply because no one knows yet what this Brexit will entail. For the time being, that means business as usual for us.”

Drew Hill, managing director of Proper Music Group said he'd be "surprised if anyone knows exactly how this is going to play out".

"My gut feeling is that, in the medium to long term, we may see an increased administrative burden placed on dealings with our European partners, which would in turn lead to increased costs to customers and suppliers.   In the short term, while we’re not affected by the stock market, we are by currency exchange volatility.  With the majority of British music actually manufactured in Europe, many UK labels will need to pay more to have their stock manufactured. And US labels will make less back from their UK sales.  

"Proper has always been agile and able to adapt quickly, and we’ll be ready to react to whatever legislation Brexit throws at us. Until then, it’s business as usual."

David Schollenberger, a media and entertainment partner at Healys law firm said the Brexit vote "will negatively affect Britain as a place to invest and set up as a head office for music businesses".

"It will create uncertainty about future tax rates, inflation and economic prosperity and lose its appeal as an international centre able to trade and move employees freely with other EU Member States," he added.

UK Music CEO Jo Dipple said: “Clearly, there are lots of very important decisions that will be made over the next few weeks. We will have a new Prime Minister in the autumn, there will be a new Government and UK Music will work very hard with the new administration to ensure the music industry continues to be well served by the British Government. We need a united business voice to ensure that, when renegotiations take place, markets continue to serve the music industry. In John Whittingdale, we have a politician who understands the creative and music sectors and [who] will have our best interests at heart.”

BASCA CEO Vick Bain said: "I think it's a troubling day for the UK music industry. Over the past few decades, songwriters and composers have benefitted from strong IP legislation and we have only just implemented the Collective Rights Management directive. Whether we will continue to enjoy this protection is now anyone's guess, but I predict an erosion even more in favour of Big Tech."

And European indies body Impala issued a statement saying: "Change is on the way, that’s for sure, but one thing is clear. The UK music sector will remain a fundamental player in Europe, which of course goes beyond the EU and we will continue to work hard to ensure that Brexit doesn’t interfere with the ability of European citizens to continue to enjoy UK music and vice versa. Breaking borders is what our labels do with their artists on a daily basis and that will continue. We are all Europeans and AIM’s role within IMPALA will remain key - we have so much to achieve together. We are the European Music Union and we will work hard to make it flourish." 

But veteran promoter Harvey Goldsmith dismissed concerns about how the change could affect the business.

"I don’t believe it’s going to affect the music business that much," he said, "Because we have to do enough bloody paperwork as it is with taxes and all that kind of business that we have to deal with on the road in Europe. It’s still exactly the same from a live perspective and I personally hope that we end up with a strong enough leadership who can go in and completely renegotiate a proper deal with Europe, now we’re not paying for a bureaucracy that we don’t need."

This story will be updated throughout the day with further reactions from across the business.

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