British musicians contribute £4bn to UK economy

The UK music industry contributed $4.1bn to the economy last year, according to a report by industry body UK Music.

The majority of the total revenue came from music exports, which rose 3.4% to £2.2bn in 2015. One in six albums sold worldwide were by UK artists including Adele, Ed Sheeran, One Direction, Coldplay and Sam Smith. Five of the top 10 artists in the world last year were from the UK, taking up 17% of the global market.

Live music has however taken a dive, contracting by 2% to £3.7bn. This was despite 27.7m attending music events in the UK during the period. The report attributed this to the closure of smaller "grass roots" venues such as the Marquee Club and the Astoria in London.

Another trend that the report found was that growth in streaming services such as Spotify, Deezer and Apple Music is “the key to renewed and continued growth for British music and its artists globally”.

Music streaming revenues rose by 49% to £251m last year compared to £168m in the previous year.

The report comes as UK policy makers prepare for the second reading of the Digital Economy Bill in the House of Commons on Tuesday.

The rise in streaming over ownership has led to a call for policies that provide fair remuneration for artists and rights holders.

Minister of State for Digital and Culture Matthew Hancock said last week that “enforcement and fair treatment of rights owners is critical to healthy creative industries”.

The amount of revenue YouTube paid to music labels relative to the number of streams of their content halved last year according to research from Midia. This implies a potential loss of revenue of $755m for the industry.

“The You Tube model, despite its reach, is yet to deliver fair financial returns for rights owners and creators," claimed Jo Dipple, chief executive of UK Music.

YouTube argues that because its business model is based on advertising revenues, its streaming rates for musicians cannot be compared with the payments from other platforms such as Spotify which gives more than 80% of subscription revenues to artists.

The report also voiced concerns over the music industry’s post EU referendum prospects and called for policies that would maintain its export power.