* Sector dominated by tech platforms, music majors
* Initial market study could lead to full investigation
LONDON, Oct 19 (Reuters) - Britain's competition regulator
plans to launch an examination of the music streaming market to
see whether a sector dominated by platforms such as Spotify
and Apple works for consumers.
The watchdog's announcement on Tuesday follows a report from
a UK parliamentary committee this year, which warned that the
ties between music majors and streaming platforms could stifle
innovation in the sector.
"The UK has a love affair with music and is home to many of
the world's most popular artists," CMA Chief Executive Andrea
Coscelli said. "We want to do everything we can to ensure that
this sector is competitive, thriving and works in the interests
of music lovers."
A market study is used to examine a sector and decide if an
intervention is needed. Outcomes can include asking the
government to change regulations, encouraging businesses to
self-regulate, taking action against companies and a full,
A spokesperson for Spotify declined to comment. The British
music industry body, the BPI, said it welcomed the study. "We
look forward to seeing the scope of the project in due course
and engaging with the CMA to inform its work," it said.
Britain's Competition and Markets Authority has taken an
increasingly proactive role in the regulation of digital
markets, with investigations already launched into the power of
Google, Facebook and Apple in different parts of the ecosystem.
It said it would now turn its sights to music streaming
which, in Britain, accounts for 80% of music consumption and is
dominated by the likes of Spotify, Apple Music, Amazon
and Alphabet Inc-owned YouTube.
Having been hammered by piracy in the late 1990s, the music
industry moved towards a streaming model backed by either
advertising or subscriptions as a way to secure more sustainable
revenue for the sector.
Official figures show that the global recorded music market
rose by 7.4% in 2020 to $21.6 billion, with a jump in demand for
paid streaming services leading the way.
A British report on the sector showed that there were 139
billion audio streams in total last year. Despite the growth,
artists have long complained that they do not receive a fair
share from streaming platforms.
The UK parliamentary report also noted that the three major
music companies, Universal, Sony and Warner
, also covered up to 75% of the UK recording market and
had close ties with streaming platforms, prompting lawmakers to
question the level of competition in the sector.
(Additional reporting by Supantha Mukherjee in Stockholm
Editing by Susan Fenton and David Goodman