Large organisations
The Minister of Culture calls for action: Establish a working group for the music streaming economy

"It is completely unfair when a fundamentally unsustainable digital industry is allowed to starve the musical food chain for its own gain." So write seven of the Danish music industry's main organisations, who want Jakob Engel-Schmidt (M) to set up a working group focusing on the music industry's challenged streaming economy.

The debate post was published by Culture Monitor December 2024

Before Minister of Culture Jakob Engel-Schmidt (M) went on maternity leave, he announced the establishment of a working group for literature, which was to look into the low payment to authors and others in the digital book sector.

It shows both responsibility and foresight that the Minister of Culture actively chooses to look at the conditions of art in a digitalised reality.

The latest figures show that Spotify exits 2024 third quarter with a profit of €484 millionThis is due to 21 million new paying subscribers in conjunction with the so-called bundling, which reduces payments to artists by around five per cent. The bundling model, where music streaming is bundled with other products, is widely used in the US - and in Denmark via mobile subscriptions - but we can assume that Spotify will increasingly transfer the business model to the European market.

So while users are flocking to music streaming services, the payment for each streamed track has become too low. Therefore, it will require more knowledge about global market mechanisms and business models if we are to actively address this market failure.

New reports clearly show the need
Earlier this year, a report from the Nordic governance collaboration Polaris showed that streaming is consumers' favourite platform for finding and listening to music, with 95 per cent of all users across the Nordics stream music.

Overall, more music is listened to via free subscriptions on platforms like YouTube and Spotify Free than via paid access. This has a very negative impact on artists' income.

More knowledge is needed on how we can regulate the streaming market to provide fairer and more sustainable conditions for music artists

A new report from the International Artist Organisation (IAO) asked around 10,000 European music artists about their satisfaction with streaming. Here are the answers over 90 per cent, that they are unhappy with the payment and the insight they get into sales and availability data. This is despite the fact that the EU has created a new directive to ensure the same.

The government's expert group on tech giants reaches the same conclusion in their third report, which has just been published. Principle 2 of the report identifies the lack of access to data as a societal problem because data "resides in closed silos - and often with tech giants".

In other words, it's not a sustainable music industry when virtually all music listening takes place in a place where those who create the music neither have insight into the money flows nor get a fair payment.

A democratic problem for the future of fans and communities
Music is a crucial parameter for diversity, inclusion and social mobility. It is the most widely used and practised of the arts, forming a crucial cornerstone of our lives and communities.

Therefore, it is completely unfair when a fundamentally unsustainable digital industry is allowed to starve the musical food chain for its own gain. It is a shared responsibility to ensure a diverse music offering that is accessible to everyone in the future. Big tech and streaming services are currently far from taking on this task.

We need a working group on the music streaming economy to investigate how the new EU legislation is being implemented in practice. And we need more knowledge on how to regulate the streaming market to provide fairer and more sustainable conditions for music artists.

This knowledge is crucial to ensure that the future of Danish music is sustainable - and not decided in Los Angeles by tech companies.

We hope that the Minister of Culture will listen and set up the working group as soon as possible in the new year.

Behind the debate post

Sara Indrio - Chairperson of the Danish Artist Association
Tobias Stenkjær - Chairperson in Danish Popular Authors
Lasse Matthiesen - Forperson in Author
Thomas Sandberg - Chairperson of the Danish Federation of Musicians
Juliana Hodkinson - Chairperson of the Danish Composers' Society
Ole Dreyer - Chairman of the Board in Musikforlæggerne
Loui Törnqvist - Forperson in Koda