Before the days of streaming platforms music artists and labels would make most of their revenue through physical record sales. But since streaming services like Spotify and Apple Music came along, while it’s easier for consumers to access new music, it’s also harder than ever for artists to make money.
The United Musicians and Allied Workers found that in 2023 the maximum an artist is paid per stream on Spotify is just $0.003. Vinyl records have made a comeback in recent years, with some bands successfully selling chart-topping quantities of vinyl.
Indie rock band Idles saw 85% of their No1 album chart result being made up of physical record sales, demonstrating the prevailing popularity of vinyl albums. But for most upcoming artists, the majority of their exposure to audiences comes from online consumption and not physical sales.
This has led many artists to become reliant on merchandise sales and ticket revenue, both of which have become increasingly difficult to sustain as a result of Brexit and the cost-of-living crisis.
The impact of Brexit:
According to evidence submitted to Parliament by UK Music, music creators have reported that 50 per cent of their export income across all income streams comes from the EU. This has accentuated the negative impact of Brexit for the UK music industry, with artists being forced to comply with strict touring regulations. Mounting customs paper work and admin costs are increasingly disincentivising British music artists from performing in the EU. Since Brexit, all UK artists touring the EU must fill out carnets (temporary export and import documents) for all their musical equipment. Items required to be listed can range from amplifiers and drum kits to even the smallest of items like guitar plectrums. The legal costs, time wasting and form filling means it’s extremely hard for upcoming bands to break even when touring the EU, let alone make a profit.
But Brexit hasn’t impacted all bands equally. Those signed to major record labels benefit from legal backing of multibillion dollar companies and have the funds and lawyers to fill out carnets and comply with regulation. Those signed to independent labels, often upcoming or more niche bands, cannot afford such luxuries. This creates major inequality within the industry, risking domination by conglomerate music labels and crushing creativity.
Grassroots music venues
The music industry is an interdependent ecosystem in which various stages of production are reliant on one another to continue to stay alive. Small grassroots venues are essential platforms for upcoming artists to develop their skills, build audiences and perform new music. Yet for a long while governments and councils have neglected small music venues, often prioritising building developments.
Two of Brighton’s most iconic music venues, The Prince Albert and The Venue, fear closure due to development plans next to their premises. The venues are both Grade II listed properties making for a unique live music experience. But more importantly, closure would result in the loss of a crucial element of Brighton’s music scene, risking the suffocation of creativity amongst local artists needing a place to play.
But it’s not just planning applications putting local music venues at risk. High operating costs continue to shave off profit leaving many small venues at risk of not breaking even.
In an economy in which, on average, two grassroot music venues close per week, without intervention it’s only a matter of time before independent and upcoming artists are starved out of the industry.
The Government-backed ticket levy
As of November 2024, the government officially backs plans for a voluntary levy on ticket sales made by arena venues and stadiums. This would mean a proportion of ticket revenue would be redistributed to grassroots music venues, delivering significant financial support to small grassroot music venues, many of which are struggling to keep their doors open amid financial strain.
While the voluntary ticket levy offers some hope for small venues, the Music Venue Trust has also called for cuts to VAT on all music tickets, with the goal of lowering prices to increase demand.
It is clear that government support and action is urgently required to allow the industry to thrive. Without further support, the government risks a continued decline in the industry with the UK’s global market share of recorded music already having fallen from 17% in 2016 to 12% last year.
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