Nigel Adams
Main Page: Nigel Adams (Conservative - Selby and Ainsty)Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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Mr James Gray (in the Chair)
Before commencing our first debate, may I remind hon. Members that reference to people in the Public Gallery, no matter how distinguished they may be, is out of order and should not be done during the debate?
Nigel Adams (Selby and Ainsty) (Con)
I beg to move,
That this House has considered artistic remuneration for online content.
It is a pleasure to serve under your chairmanship this morning, Mr Gray. I thank my hon. Friends the Members for Somerton and Frome (David Warburton) and for Folkestone and Hythe (Damian Collins) for helping me to secure this important debate.
Everyone is aware that the creative industries are one of this country’s greatest assets. The Government’s own analysis shows that the gross value added of the creative industries in 2014 was in excess of £84 billion, which accounts for around 5.2% of the UK economy. Essentially, they have been a source of growth in recent years, increasing by 6% since 1997, compared with 4.6% for the UK economy as a whole. However, we would be doing the industry a disservice to consider its value in purely economic terms, because its impact is far wider.
Our creative industries are our voice to the world. Very little, if anything, contributes more to the UK brand around the world than our artists, writers and directors.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
Hear, hear.
Nigel Adams
Quite right.
Just a few weeks ago, the trade body, UK Music, published a report on the value of music tourism to the UK, which showed that direct and indirect spending in 2014 from music tourism was £3.7 billion. Some 38% of live music audiences are music tourists: music lovers from outside the UK. They come because they love our world-class artists and our fantastic venues and festivals. It might be easy to take our creative industries for granted and to assume that the country that gave the world Shakespeare, the Beatles, Harry Potter and Banksy will also be at the forefront of the global culture landscape, but that would be a massive mistake. Indeed, we in this House have a duty to ensure that our cultural sector has the tools to grow, including a copyright regime that is fit for purpose in a digital online market.
Members may have read about the recent public disagreement between songwriters and artists and YouTube over royalties paid by the service. In the last few weeks, 186 major artists in the US and over 1,000 in the UK and Europe have signed public statements of dissatisfaction addressed to the US Congress and to Jean-Claude Juncker. Signatories range from Sir Paul McCartney and ABBA to Ne-Yo, Idina Menzel and deadmau5, and even includes the former French first lady, Carla Bruni, who is also a recording artist—although I do not have too many of her tracks on my iPhone.
Last month, I met members of PRS for Music and songwriters and composers whose music and songs are enjoyed around the world. I heard from them the dissatisfaction that millions of streams can result in just a few hundred pounds in royalties or, in some cases, no royalties at all. Most dramatically, I spoke to one songwriter who was entitled to 25% of the revenue from a song he wrote, but who had seen a mere £5.39 from almost 3.2 million plays of that song on YouTube by listeners who actively sought out that track. Meanwhile, the same songwriter saw several times that amount—a princely £87.79—from the 180 occasions on which the song was played in stadiums in the UK, despite those listeners being passive and hearing what others chose to play for them. That seems to be a pretty upside-down arrangement.
To show how far behind the law the balance is, Geoff Taylor of the British Phonographic Industry recently said that British artists saw more revenue in 2015 from the 2.1 million vinyl LP sales than from the 27 billion music video streams on YouTube and similar platforms. It is not difficult to understand the despair of a writer or artist who sees their life’s work online with little hope of any financial reward now or in the future. This is particularly a problem for less high-profile producers, writers and creative people, who are less likely to have additional income streams from endorsements or touring.
High-profile artists are often very concerned about this problem and its impact on other members of the creative community and their teams. A big artist will often get little sympathy and, as we have seen recently, there may even be a backlash from the media and consumers for speaking out about the problem if they are perceived to be well off. Fair or unfair, this reaction just makes it harder to expose the problem and to support fair remuneration for those in the industry who are less famous.
The basis of the music industry’s concerns is the so called “safe harbour” laws, which in the US, EU and UK give user upload streaming services the same protection from copyright as host providers, such as personal cloud locker services. This is despite the fact that they operate entirely differently and, more importantly, impact the market in different ways. Take, for example, a comparison between Spotify and the user upload site Dailymotion. Both sites allow users to search for and listen to Adele’s track “Hello”, one of the fastest-selling tracks of all time. Spotify is licensed to stream that track and thus pays the artist, songwriter, producers, musicians, publishers and labels that are so crucial to creation of the content, but Dailymotion does not. Due to ambiguity in the safe harbour framework, user upload services can claim to be mere hosts of their user’s content and, as such, are not required to share with the creators the wealth they generate for themselves. That does not seem fair.
When a business model is based on making available to consumers creative content created by others, surely we as lawmakers must ask whether this is right. In fact, the very premise of copyright is to ensure that creators are paid when their work is exploited by others.
It may be easy to argue that the current framework is good for consumers. How can it not be, when music can be enjoyed more easily than ever before? However, I would add a note of caution to such assumptions and suggest that the user experience may not be as positive as it might first seem. When faced with piracy, it was universally agreed that creative content has an intrinsic value that must be protected if the future generation of creators are to be nourished for society’s economic and cultural benefit. These principles remain true today and we must not replace one market failure with another.
Equally, there are impacts on the licensed streaming services to which many users pay a monthly subscription. These services are forced to compete on an unequal playing field with user-upload services that pay little or nothing to creators. They are forced to offer their own ad-funded services, which are often run at a loss or subsidised by income from the subscription service. The net result is less competition in the market for subscription pricing and ultimately consumers could lose out.
In March, the all-party parliamentary group on music, which I chair, hosted a dinner to discuss the growing music streaming market. The dinner was well attended by services such as Apple Music and Spotify, as well as representatives of the music industry. It was clear from the dinner that streaming presents many opportunities for the industry and that it is embracing them. However, there are challenges in ensuring the music industry captures this value, such as whether advertising revenue and ad-funded models are sustainable and the growth of ad-blocking and stream-ripping technologies that can have an impact on the amount of remuneration the industry receives in return. The legal position of safe harbours and how they interact with the market perhaps presents an even more fundamental problem, and this will continue unless action is taken.
The Creative Industries Council launched its strategy this week, with many recommendations to the Government and industry alike. The council is seeking legal clarity concerning the liability of platforms that actively host and market content. Specifically, it argues that to maintain an intellectual property framework fit for the digital age, such platforms should not benefit from safe harbours. The Government have indicated that they would support a clarification too. I would be grateful if my hon. Friend the Minister said what plans the Government have to respond formally to that recommendation and what further steps they are taking to achieve that.
Kevin Brennan (Cardiff West) (Lab)
I declare an interest, in that I earned £10.60 in royalties from PRS last year for my songwriting—and paid 40% tax on it. Will the hon. Gentleman address the role of search engines in all of this? I recall that a few years ago we did a search during a debate and found that most of the results that came up were from illegal sites. Is that an issue that he thinks the Government should also be doing more to address?
Nigel Adams
It is absolutely an issue that needs to be addressed. I have myself searched online and found that the results I get are from piracy sites. Something has to be done. There is a responsibility in this respect not just for Government, but for the search engines themselves. Perhaps afterwards I can help the hon. Gentleman spend his £5.60 as we discuss what should come out of this debate.
We are in a unique place to address these issues and ensure that we are world leaders in striking the right balance between the promotion of technology and creative innovation. With the recent vote to leave the EU, the UK Government will have full control over policies related to digital streaming and artist remuneration. Will the Minister undertake to investigate whether provisions can be put in place so that once we eventually leave the EU, our UK industries can fully achieve the value in their rights?
Nigel Adams
That is encouraging. Will the Minister investigate, for example, the possibility of introducing a sunrise clause into the Digital Economy Bill? That could ensure that active hosts of content do not benefit from safe harbour when legal systems have been transferred and the European Communities Act 1972 is repealed.
It will not surprise hon. Members to hear me say that the music industry has undergone tremendous change and readjustment in its business models over the past couple of decades. The latest Intellectual Property Office and Kantar Media online copyright infringement tracker, published yesterday, concludes that the top three sources of music are YouTube, with 52%, Spotify, with 30%, and the iTunes App Store, with 20%. Use of Spotify has increased by 5% since last year’s tracker, while iTunes has fallen by 6%. The consumer trend is clearly moving away from music ownership. Copyright still reflects ownership for the creators of content and the infrastructure that supports it. We must ensure that those ownership rights are respected.
Nigel Adams
I thank the Minister for his remarks, and I also thank all colleagues who have contributed to this debate; it is great to see such cross-party agreement on this important subject.
As hon. Members can imagine, I have been contacted by quite a few people from within the industry about this debate, many of whom are artists. I will wrap up the debate by quoting a couple of people who have been in touch with me. First, I will quote a gentleman called Brian Message, who works in artist management. He says:
“The advent of the digital era introduced an opportunity for those involved in the music business to pull together for the economic benefit of all stakeholders. To our collective detriment, this did not come to pass.”
A songwriter, Rupert Hine, wrote to me to say:
“Put the world’s most ubiquitous search engine together with the world’s most ubiquitous noticeboard and you have created the one place on Planet Earth where you can view all the world’s Art and Culture for absolutely nothing. Great for the ‘Users’—but unsustainable for the ‘Creators’.
Artists are all but giving up. All the digital arts…are given away for free via Google’s YouTube. The world is not awash with Adeles and Coldplays or any fleeting product of broadcast talent shows. The world is full of artists trying to express themselves in a…way that moves us and makes us feel differently about the world and our place in it. For them, the meagre breadcrumbs collected from advertising revenue via YouTube is insulting—and more importantly unsustainable.”
Motion lapsed (Standing Order No. 10(6)).