Following the swift reaction of the music industry trade bodies, Hipgnosis founder Merck Mercuriadis is one of the first top executives to speak out following the verdict of MPs on the major labels’ role in the streaming economy.
You can read the reaction so far here and Music Week’s analysis of the report here.
While there was a focus on recorded music in the inquiry, MPs also paid close attention to how streaming works for songwriters and music publishers.
Just to recap, the report’s recommendations include a call for the government to work with creators and the independent publishing sector to explore ways in which emerging songwriters and composers can be supported to have sustainable careers, and for independent publishers to be commercially viable. As part of this, MPs want the government to consider how to ensure that the song is valued in parity with the recording (currently around 15% of streaming revenues are distributed to song rights-holders compared to 55% for recordings).
A better royalty rate for songwriters is also good for Hipgnosis, which has built its business on acquiring the composer’s share of publishing rights.
Music Week first revealed last year that Hipgnosis founder Merck Mercuriadis was adding his voice to the streaming debate with a submission to the inquiry.
Our wish is that this will lead to songwriters being paid fairly and equitably
In response to today’s report, Merck Mercuriadis said: “This is an impressive report from the DCMS Committee. In a short space of time our members of Parliament have been able to distil why the songwriter and artist are not being remunerated properly with some accuracy and we both applaud and support their efforts.
“We are particularly focused on their recommendations that there be a full reset of streaming in law that gives songwriters and artists a fair share of the earnings, and that further to this the government refer the case to the Competition and Markets Authority to undertake a full market study into the economic impact of the major music groups’ dominance. This is essential to ensure that the unhealthy control that the major recorded music companies have over streaming negotiations is addressed and to expose the fundamental flaws that exist within the music industry.”
“Our wish is that this will lead to songwriters being paid fairly and equitably and in a manner that recognises that without the song we have no music industry. Ultimately if we are to make streaming truly fair for songwriters and artists it is critical that they are given a direct seat at the negotiating table, have exclusive rights, not merely a right to remuneration, and are paid in line with the share taken by record labels.”
The report also suggests that all publishers and collecting societies should reveal royalty chain information to provide transparency to creators about how much money is flowing through the system and where problems are arising. There’s also a call for an exploratory audit of 'black box' royalties to achieve greater clarity as to what is genuinely impossible to allocate and what could be distributed accurately.
MPs on the committee also want the government to explore the practicalities of a comprehensive musical works database, with the Intellectual Property Office coordinating with the industry on a registration portal so that rights-holders can provide accurate copyright data to necessary stakeholders easily.