As the UK votes to elect its next government on 4 July, business leaders around the world will be watching closely to see what the outcome means for them. For the music industry, the upcoming general election, announced by Chancellor Rishi Sunak on Wednesday (22 May), could mean big changes depending on who wins.
The latest opinion polls give Labour a more than 20-point lead over the ruling Conservatives, who have been in power for 14 years. Unless Mr Sunak can pull off an astonishing turnaround in the next six weeks, Labour leader Keir Starmer is widely expected to be the next occupant of Downing Street and likely win the majority of seats.
If that happens, Starmer says he plans to introduce a raft of reforms affecting the world's third-largest recorded music market, touring and regulation of the technology industry – all of which will have repercussions beyond Britain's borders.
Increased regulation of ticket resale platforms and prospects for a future arena ticket tax
Starmer announced in March that a future Labour government would put a cap on the resale price of concert tickets and introduce stricter regulations on secondary ticket sales platforms such as ViaGoGo, which are already the subject of numerous investigations and investigations in the UK.
Starmer said Labour's policy would limit the number of tickets each scalper could sell on resale platforms and give the UK competition regulator the power to take “swift” action against services or scalpers that breach the rules.
Changes at Number 10 could also have a major impact on the global touring business. Earlier this month, a parliamentary committee called for a new voluntary tax to be imposed on arena and stadium tickets sold in the UK to support struggling grassroots music venues.
To stem the tide of smaller venue closures, the Culture, Media and Sport (CMS) committee said a voluntary levy should be introduced by September “no later.” If no progress is made, the government should introduce a statutory levy, it advised, and also called for a reduction in Value Added Tax (VAT) on tickets for grassroots music shows.
Whichever party wins the July 4 election, they'll be expected to respond to the CMS committee's report on the grassroots music industry. The committee itself will be abolished altogether when Parliament dissolves on May 30, but a new committee drawn from a cross-party coalition of lawmakers will be formed after the election. The committee can choose new topics or industries to investigate, or it can choose to build on the work of its predecessors, so Parliament's interest in the music industry is unlikely to disappear.
According to industry body UK Music, the industry is expected to contribute 6.7 billion pounds ($8.2 billion) to the UK economy in 2022 from music sales, concerts, recording studios, touring and music tourism, and government leaders will be eager to show they are doing all they can to protect the music industry.
AI and Big Tech Regulation
Following the general election, the key issue of regulating the use of artificial intelligence (AI) is likely to rise near the top of the legislative agenda and will continue to be a source of intense lobbying from the tech and music industries.
The current Conservative government has been discussing the issue for the past few years but has yet to set out any firm plans, and has generally pursued a light-hearted, “pro-innovation” approach to regulating AI.
In 2023, the government quietly shelved the Intellectual Property Office's (IPO) proposal for a new text and data mining (TDM) exception that would have allowed AI developers to freely use copyrighted works for commercial purposes (albeit with certain limitations), following heavy criticism from the music industry.
Since then, there have been repeated calls from music industry groups, such as recording industry body BPI, for governments to follow the example of the European Union and protect creators, musicians and rights holders from the potential risks of generative AI models.
Earlier this month, the All-Party Parliamentary Group on Music (APPG) called for a comprehensive “Pro-Creative Industries” AI Bill to protect the music industry from the “threats” posed by AI technology. Its recommendations included banning AI developers from using copyrighted music for training purposes without consent, and requiring tech companies to clearly label all AI-generated content.
If Sunak remains in power, music industry executives will be keen for him to fast-track UK AI legislation and ensure the UK keeps up with other countries and markets in regulating the sector.
Labour's position on AI, as outlined by Starmer last summer, is to introduce stricter regulation than the Conservatives, but few details have been released and the party has appeared to soften in recent months as it seeks to garner support from business leaders and tech executives by portraying itself as a “pro-progressive” next government. Labour had been working on an AI strategy document ahead of the general election announcement, which was due to be published this month.
Addressing artist and songwriter frustrations over streaming rules
Over the past four years, the UK has been at the forefront of addressing artists' dissatisfaction with low payouts from music streaming, and since the issue came to the fore with the pandemic-induced shutdown of the live industry in 2020 there have been a number of parliamentarily-led investigations into the recording industry, including a review by the UK competition watchdog into the market dominance of the major record companies.
A bill that would have required record companies to pay musicians and songwriters a greater share of streaming revenues was debated in Parliament in December 2021. The bill was defeated at the first stage, but the possibility of government interference in the UK music industry has led record companies to beef up their public policy teams and devote significant time and resources to responding to various inquiries.
Increased scrutiny of the music industry has yet to translate into legal changes, but it is putting pressure on labels to improve contract terms and agreements for artists. Although a government-led task force focused on creator compensation was recently launched (and is likely to continue after the election, according to sources), the uproar for many artists over low streaming royalties is unlikely to die down anytime soon.
Last month, the Culture, Media and Sport (CMS) Committee published a report calling on government ministers to “do more to ensure that music creators are fairly rewarded” and to push for comprehensive copyright reform. The committee's recommendations include an overhaul of the revenue-sharing ratio between mechanical and publishing rights from music streaming, which currently stands at around 55% for mechanical rights and 15% for publishing rights, to better reward songwriters.
“It is vital that the new government implements the recommendations of the Culture Select Committee, resets the streaming market and supports grassroots live touring,” said Annabella Coldrick, chief executive of the UK Music Managers' Forum (MMF).
“More broadly, we need a government that values British music, puts it at the forefront of its growth agenda and backs it up with a credible music strategy to unlock the full potential of the UK music industry at home and abroad,” Coldrick added.
British people will decide on 4 July whether Sunak or Starmer are to blame. If Labour wins the general election, two big names in music could join the party in power: Blur drummer Dave Rowntree is standing as Labour's candidate in the Conservative-held Mid Sussex constituency, while Tom Gray, co-founder of indie rock band Gomez and chairman of the Ivor Academy, is the party's candidate in Brighton Pavilion.