Kelvin Hopkins
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Kevin Brennan (Cardiff West) (Lab)
I had not intended to make a speech, but the debate has been so stimulating that I have awoken and got to my feet. I just want to make a few general points because I have not prepared any remarks.
Like my hon. Friend the Member for Bristol West (Thangam Debbonaire), I have been doing some activities with the Industry and Parliament Trust, which is an excellent body that allows parliamentarians to get a more in-depth knowledge of business. In my case, that has been in relation to the music industry. Over the past 18 months or so, I have been visiting all sorts of different businesses and aspects of the music industry from collection societies right through to record companies and small, independent songwriters and producers. I have had the opportunity to see all the different aspects of the music industry, as many different industries are involved in the production of music, which is a fascinating eco-structure.
Having observed lots of different aspects of the music industry over the past couple of years, it is pretty clear to me that there is a trend towards streaming; it is the main way in which consumers listen to music now and it will be into the future. That has implications for the way in which artists are remunerated.
Despite what hon. Members have said about CDs disappearing and so on, a surprising trend in the music industry has been the growth of the compilation CD, which has gone against the trend of declining CD sales in recent years as people want somebody to curate the vast amount of music that is placed in front of them on their behalf. People purchase compilation CDs because that curation is done for them. Those consumers are, generally, of a certain age but, nevertheless, that has been a surprising area of growth reported by some record companies.
There will always be a demand for physical formats of music. The growth of vinyl sales in recent years is an indication that people are hankering after something real, physical and tangible—with a gatefold sleeve and a wonderfully high-quality vinyl record—that they can tuck under their arm and carry down the road before going through the wonderful ritual of putting it on to their turntable and playing at home.
The growth in vinyl sales is not just among people like me who are rebuying all the albums that they gave away when they thought vinyl was disappearing 20 or 30 years ago, rebuilding their record collections and buying new music. It is also among young people. When I go into real, independent record stores such as Spillers Records in Cardiff—the world’s oldest record store and one of the finest establishments in the country—young people are at the head of the queue to buy vinyl. That physical format will remain because there will always be people for whom music is their ultimate passion and is much more than the wallpaper of their life. Music is actually tied into their identity as human beings in a powerful way.
Kevin Brennan
I will in a moment but I am just getting worked up.
There will always be a minority of consumers who fall into that category, but there are millions of other people for whom music forms less of an obsession but is, nevertheless, an essential part of their life, even if they are not as obsessed as some of us.
Kelvin Hopkins
I agree very strongly about CDs and vinyl. Does my hon. Friend agree that, as CDs are a physical form of music, sleeve notes, artwork and all sorts of other things add to the enjoyment of that music? It is not just about the sound through a set of headphones.
Kevin Brennan
Yes, I agree, but the point that I was about to make is that there are many millions of consumers for whom that is less important than it might be for my hon. Friend and I, who pore over such things. I am sure that he can remember, as I can, who played bass or slide guitar on which track, the exact length of each track, and who wrote the lyrics and the music—all the details that we store up.
The consumer model that is emerging is that the consumption of music will become part of most people’s general consumption of creative content, which will include film, music, television programmes and so on. We are moving into a world where people can consume creative content of whatever variety any time, any place, anywhere. That will work as a general subscription model in which most general consumers will pay for their internet, television and music all wrapped up into one family package. People already do that with their broadband, television services and telephone services. It is sometimes a bit of a stretch for consumers to go from nought to £10 but it is less of a stretch—although times are tough—for some illogical human reason, to go from £60 to £70 when they are paying into a subscription service. The Government, in their policy development, need to think through the implications of that trend.
We need the right copyright structure, legal structure and penalties, where they are required, to ensure that the people who make creative content are appropriately rewarded, whether it is from physical sales—which will continue to be an important part of revenue to the industry—or when their work is part of a more general subscription service. We must deal with the illegal content and the legal loopholes such as safe harbour that allow content to be consumed online without creators getting the appropriate reward. The Minister is a thoughtful person and I hope that he has something to say about how the Government see a way forward.
Kelvin Hopkins (Luton North) (Lab)
It is a great pleasure to serve under your chairmanship, Mr Gray—it is a great pleasure to serve opposite the Minister as well.
I congratulate the hon. Member for Selby and Ainsty (Nigel Adams) on securing this important debate and on his eloquent and well argued speech. I also congratulate all the other Members who have spoken on their eloquence and their erudition, which is rather more impressive than my own in this matter.
This area is clearly one in which further Government action is required to ensure that musicians, singers, songwriters, composers and producers receive their just financial reward—payment commensurate with their talents, creativity, hard work, popularity and need to make a decent living and receive appropriate rewards. As a former part-time jazz musician and a member of the Musicians’ Union in my youth, I have some acquaintance with the music industry, although I never had to depend on playing music for a living—unlike at least two hon. Members present, who have been professional musicians and to whom I greatly defer. For 15 years I was a board member of the National Youth Jazz Orchestra and I am now an honorary member of that organisation, so I have a background in and current contact with music, although I have to say that popular music is not one of my areas of expertise.
As it happens, in my first Adjournment debate in this Chamber some 18 years ago, I called for better financial support for jazz from the Arts Council and the state sector in general. Many jazz musicians have always struggled to make a living from their music, despite their brilliance and their passionate and dedicated supporters and listeners. The audience for jazz is similar in size to that for opera, but the support it gets is a tiny fraction of that for opera—although I am an opera lover as well and do not want to see opera deprived of funding in any way. Famously, the great Ronnie Scott subsidised his jazz earnings by playing tenor saxophone on the hit recordings of Tommy Steele in the 1950s and ’60s. Many other jazz musicians were also session musicians to sustain their primary artistic concerns.
Downloading and streaming were unimaginable in my youth. The music world is now infinitely more complex, with sophisticated techniques necessary to ensure that artists are properly paid and not simply exploited by the online industries. That is a particular problem for Britain and British artists, because of the sheer volume of brilliant music and musicians of all kinds that this country produces. In classical music we are one of the greatest of musical nations; in jazz we are second only to its original birthplace, the US; and in popular music we have had a dominant position in the world since at least the 1960s. It is therefore right that we take the problems raised by the hon. Member for Selby and Ainsty and other speakers in this debate with the utmost seriousness.
As we have heard, the BPI, the Musicians’ Union and others, as well as some of our greatest artists, have made a number of proposals for the Government to include in the Digital Economy Bill. The sums of money made by Spotify, YouTube and others are huge, and far too little of that goes to the artists in the music industry. New legislation is absolutely vital to ensure that that happens. Securing proper payment has always been a problem for musicians and those in the music industry. Much music and many musicians through the ages have depended on subsidy and sponsorship from the rich, from rulers, from the Church and more recently from the state. We now have a sector that is commercially viable—modern popular music—but it, too, needs state protection to ensure that the industry’s musicians, singers, writers and producers receive their just rewards. The Government must act to make that happen.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
It is a great pleasure to serve under your chairmanship, Mr Gray; it feels like normal service has been resumed. I thank the hon. Member for Selby and Ainsty (Nigel Adams) for securing this important debate. I saw him briefly on the television as the Tory leadership campaign got under way, and he looked a bit like a special branch officer as he held open the door for one of the candidates getting into their armoured vehicle. But he has now returned to normal service, campaigning for the rights of artists as he has done since he became a Member.
The quality of the debate has been second to none, with fantastic contributions from the hon. Member for Bristol East (Kerry McCarthy), my hon. Friend the Member for Somerton and Frome (David Warburton), the hon. Members for Bristol West (Thangam Debbonaire), for Strangford (Jim Shannon), for Cardiff West (Kevin Brennan) and for Perth and North Perthshire (Pete Wishart), and of course the hon. Member for Luton North (Kelvin Hopkins), whom I have to formally welcome as the official Labour party spokesman on cultural matters. I gave my maiden speech just after he had spoken, so there will be a wonderful symmetry if I give my final remarks as a Minister with him sitting opposite me, before I get fired by the new Prime Minister in the coming fortnight. That would be a lovely bookend to my comet-like parliamentary career.
Kelvin Hopkins
The Minister is being modest. He stands to be promoted, rather than sacked.
Mr Vaizey
It is invidious of me to single out individual contributions, but I particularly welcome the contribution of the hon. Member for Bristol West. I did not get the chance to have debates with her while she was briefly the Opposition culture spokesman, but I thank her for her kind remarks about me in one of her speeches when she held that role. In that speech she showed what a huge contribution she would have made to debates on culture as a Front-Bench spokesman, and definitely will make as a Member of this House.
I do not want to be snarky, but I noticed that the spokesman for the official Opposition spoke for around four minutes, whereas the Scottish National party spokesman spoke for 15 minutes. Perhaps we are seeing the shifting sands in the SNP campaign to become the official Opposition, although sometimes brevity is the soul of wit. Before I am ruled out of order, Mr Gray—
Mr Vaizey
Let me get on to the subject in hand.
This is an important debate about a very successful industry. It is important for us to recall just how successful the British music industry is. For example, in 2015, one in six albums purchased around the globe were by British artists. We are the second-largest source of repertoire in the US and one of the biggest music markets in the world, alongside the US, Japan and Germany. Last year, Adele once again released the world’s best-selling album. Interestingly, that was the eighth time in 11 years that the global bestseller has come from the UK. Indeed, five of the world’s top 10 best-selling albums in 2015 were by British artists.
As hon. Members noted during the debate—particularly my hon. Friend the Member for Somerton and Frome, who took us right back to the beginning of music streaming—the digital technology revolution in consumer behaviour, which is disrupting almost everything at varying speeds, has of course disrupted the traditional model for distributing music. In the decade or so that I have covered this brief, both as an Opposition spokesman and as a Minister, I have seen that change take place. Indeed, when I first became a Minister, we inherited the last Labour Government’s proposals to tackle piracy, which involved sending notices to individuals who were breaching copyright. At the time, I was sceptical about how effective that would be.
I do not want to prejudge matters, but I think the strategy we adopted has, to a certain extent, been successful. There has to be a combination of carrot and stick. We were successful—this is actually thanks to the music industry—in using existing fraud legislation in the courts to ensure that the most egregious pirate sites were blocked. Interestingly, because that was existing legislation, it did not provoke the kind of controversy that surrounds almost any attempt to “regulate the internet”. When such a measure was proposed in the United States, it resulted in a lively campaign, with people claiming that it would mean censoring the internet. Why anyone would accuse people who want to take down illegal content of censoring the internet is beyond me, but people somehow feel it is a legitimate point to make.
Alongside using legislation to block websites, the carrot, as it were, has been the rise of legal music services. I was particularly pleased to see the report issued yesterday by the Intellectual Property Office, which showed that the establishment of well-known music streaming services such as Spotify has helped to shift more people towards using legal sites. It is clear from reading the IPO report that we are not nearly out of the woods yet in terms of illegal downloading and listening, with some 7 million people in the UK apparently still accessing illegal content, but it is good that music streaming services have become more mainstream, even to the extent that I now use such a service. Some progress has been made.
Before Baroness Lucy Neville-Rolfe took over the intellectual property portfolio with such enthusiasm, I regularly held round-tables with Google and many others in the industry to discuss how they would help reduce access to illegal sites, with particular attention paid to searches that threw up such sites. I am pleased to say that the Minister in the other House has continued those round-tables. I have a huge degree of sympathy with those who say that Google could and should do more. Indeed, when it came to images of child sexual abuse, we were able to work with Google to ensure that something like 130,000 different search terms would result in a blank search return, so it is clear that Google can do work on its algorithm.
The Google argument is twofold. First, an image of child sexual abuse is clearly illegal and criminal, so Google feels it can act without the intervention of the courts. Secondly, Google likes to say that for material that infringes copyright there can sometimes be a grey area. Nevertheless, there is no doubt that it can do more. It has claimed that it has changed its algorithm, but any of us who go on Google every so often and type in the name of an artist to see what emerges will still see a list of illegal content websites coming up in the results. Google does work with some of the trade associations to ensure that links to illegal sites are taken down. As the hon. Member for Bristol West pointed out, the debate is shifting and Google is starting to take a more proactive attitude on such issues, in partnership with the music industry and artists.
We have also worked with the advertising industry. People put up websites with illegal content not as an act of altruism—if one can call it that when they are stealing somebody else’s property and giving it away—but to make money. We should not forget that. One way the people who run such sites make money is by having advertising on their websites, so we have worked closely with the UK advertising industry to ensure that legitimate advertisers do not see their advertising put on such websites. We lead the world in taking such action.
Before I address some of the substantial issues that have been raised, I should mention the Digital Economy Bill, which recognises the importance of tackling online infringement. We have extended the penalties for online infringement to match the penalties for physical infringement, as the hon. Member for Perth and North Perthshire mentioned, and the Bill will give us a chance to debate many of these issues again. I look forward to some of the brilliant contributions we have heard today being echoed in that debate. In congratulating hon. Members on their contributions earlier, I should have said how impressed I am by how many active musicians there currently are in the House.
On the issue of platforms, when we talk about safe harbour we are referring to the situation that has traditionally existed for the past 15 years. Intermediaries such as YouTube claim that they are passive recipients of content and that it is not necessarily their responsibility to police that content, although they claim that they do so voluntarily but do not have the resources to ensure that such content is not online. They claim simply to be a platform on which people can put their content.
As the hon. Member for Cardiff West said, the safe harbour legislation was introduced to encourage innovation. In many respects, it has been successful. When we debate these issues and look at the negatives, we should also remember the positives. A lot of platforms, and indeed the internet as a whole, have given an extraordinary opportunity to many artists who would potentially have remained undiscovered without them. Before the existence of the internet such artists had only one door to a successful career in the music industry, which was through the record labels. The internet has widened opportunities for artists as well as causing them considerable problems.
Obviously, what sits behind the idea of safe harbour is the e-commerce directive, but that is now quite legitimately a subject for debate, and it is perfectly appropriate for rights holders to argue that the hosting defence is being abused to allow copyright-infringing content to be hosted indiscriminately without their being remunerated. That is why the hosting defence creates a value gap, as it benefits intermediaries without compensating rights holders. The hosting defence also leads to a mismatch in negotiations, giving the whip hand to intermediaries rather than to artists themselves. There are also concerns about the different types of streaming business models, and about whether they provide the correct levels of remuneration to rights holders.
As a Government, we believe that businesses must act in a socially responsible manner. That applies to platforms, which should co-operate in the removal of copyright-infringing material without harming freedom of expression. However, as I said earlier, we must also recognise the role that platforms play in driving innovation.
Kelvin Hopkins
Too often we have heard Ministers just exhorting people to behave well. Is the reality not that we need strict, firm, strong regulation to make sure that things happen, so that we do not just have to rely yet again on warm words to help musicians when what they really need is legislation to protect them?
Mr Vaizey
The hon. Gentleman makes a fair point. Many hon. Members have asked what the position on the copyright framework will be going forward, given that as a member of the European Union we have sat within the EU copyright framework. They will know that the situation is currently being considered to ensure that the right balance is struck between providing the right incentives and having the right protections.
The European Commission is considering reform in this area as part of the digital single market package. Clearly, circumstances have changed in the last fortnight. The UK was a leading voice in the debate on the future of the digital single market, and the Government and individual Ministers have built strong relationships with the Commission and with leading nations such as France and Germany, which obviously also have strong voices in this debate.
It is my personal view that we will continue to have some influence on how things develop, because this is a very public debate and the UK, along with a number of other countries, submitted a letter a few weeks ago to make the point about platform regulation. We argued first that not all platforms are the same, so we cannot simply have one-size-fits-all regulation, and secondly that we must ensure that we do not throw out innovation. I have said consistently to the commissioners that the UK Government welcome a debate on platform regulation. We are not saying that the Commission should not examine the issue; at this stage, we are simply raising some of the concerns that exist.
Kelvin Hopkins
I appreciate what the Minister is saying, but Britain’s interests in this area are far greater than those of the other nations he mentioned. We need to have national legislation that is at least as strong, if not much stronger, than what the EU proposes. Does he have any idea of the sheer volume of our interest in popular music compared with that of France and Germany? I would guess that the popular music industries in those countries are much, much smaller than ours.
Mr Vaizey
I accept that the British music industry is probably bigger than the music industries in France and Germany given the profile of British artists. However, a company such as the French firm Vivendi, which owns Universal, is a pretty big music company. I do not know what impact Brexit will have, but at the moment the projections are that we will overtake Germany in the overall value of our entertainment market. Nevertheless, the German market is currently bigger than the British one, and no one needs any lessons about how seriously the French take their own cultural offer and the work they will do to ensure that it is protected.
What I am really saying to the hon. Member for Perth and North Perthshire is that I see a partnership developing between France, Germany and the UK, in which we look for areas of agreement. However, I hope that at the heart of that partnership there will be an emphasis on protecting remuneration for artists and achieving a fair balance between the innovation that platforms have brought to the distribution of music, for example, and some of the issues that have been thrown up by trade bodies in particular. For example, it has been pointed out that the number of music videos on YouTube has doubled, yet the revenue for artists and labels has flatlined.
It is also important to remember that there are different emphases within the music industry itself. Clearly, the BPI does a fantastic job in representing the music industry and talking about issues such as safe harbour and copyright infringement, but of course the Featured Artists Coalition, the artists’ organisation that is so ably led by people such as the brilliant musician Sandie Shaw, has its own proposals that we need to consider properly and seriously, for example about transparency in the value chain.
I want to talk briefly about the relationship between creators, their producers and the publishers, because that relationship is absolutely vital in helping creators bring their product to market. Nevertheless, as we have already heard from some hon. Members, there is a fear that authors and performers are missing out as a result of restrictive, imbalanced or opaque terms and practices. We take such issues seriously. We want to understand how we can make progress and what the impact of certain reforms might be in different sectors and scenarios. We want to ensure that there is a balance; we want creators and performers to receive fair remuneration, but we also want investment in innovation and resources.
Any proposals that would result in restrictions on freedom of contract would need to be subject to rigorous examination. Transparency is an important feature of well functioning markets, and I know that creators would welcome moves to make it easier for them to understand the value that their works have generated. Again, there is an opportunity for partnership in that regard. For example, I welcome the BPI’s introduction of a portal that allows an artist to measure the remuneration they are receiving from streaming services.
I have covered a lot of ground, and this has been a great debate, but we should have the opportunity to hear again from my hon. Friend the Member for Selby and Ainsty about what progress he thinks has been made in the past hour and a half.