Music

UK Music Returns $9.6B to British Economy – But Global Competition and AI Threat Signal ‘Tipping Point’

LONDON — The United Kingdom’s music industry is at a “tipping point” due to increasing competition from other international markets and the threat posed by unregulated generative Artificial Intelligence (AI), the head of umbrella organization UK Music has warned.

In 2023, the music industry contributed £7.6 billion ($9.6 billion) to the country’s economy, up 13% from the previous year, according to the organization’s annual This Is Music study, which measures the economic impact of the U.K. music industry across all income streams including live, record sales, publishing, merch, brand endorsements and public performance revenue for UK based music creators and rights holders. 

Related

Huge grossing U.K. tours by Beyonce, Burna Boy and Harry Styles helped drive the record economic contribution, said UK Music, which bases its calculations upon the gross value estimates of money generated through music sales, concerts, recording studios, touring and music tourism — roughly equivalent to pre-tax profits and salaries.

However, despite strong appetite for British artists and songs, the country’s music market is facing several significant challenges that threaten its continued prosperity, says UK Music. It identifies increasing competition from other international markets, tough financial conditions for grassroots artists and music venues, as well as the potential risks posed by generative AI on music creation as the biggest dangers to the sector.

According to export figures released earlier this year by U.K. labels trade body BPI, artists from the United Kingdom now cumulatively account for less than 10% of global music streams, compared to 17% in 2015. BPI says the U.K.’s declining share of the global music market is partially down to it facing tougher competition from fast-growing international markets such as Latin America and countries like South Korea.

The U.K.’s grassroots live sector is also battling a number of well-documented financial hardships with around 125 small capacity music venues closing in 2023 and more 350 currently at risk of closure, according to the Music Venue Trust (MVT) charity. Additionally, this year has seen 60 U.K. music festivals either postpone, cancel or close due to rising costs, slow ticket sales and poor weather, says the Association of Independent Festivals (AIF).

“We are now at a tipping point, and if the problems we face are not addressed then future growth cannot be guaranteed,” said UK Music chief executive Tom Kiehl in a statement on Wednesday (Nov. 20).

Related

Kiehl said that without tougher regulation “the wild west” of generative AI could further undermine the U.K.’s long-held status as the world’s second biggest exporter of music behind the United States. Kiehl is calling for the British government to press ahead with implementing laws that protect artists and rights holders from AI developers using copyright protected works to train their systems without permission.

UK Music also wants to see ministers establish a legislative framework that will require tech companies to clearly identify AI created music and keep records of works that have they have ingested, akin to what the European Union introduce earlier this year in its AI Act.

Other areas where UK Music said urgent action was needed to maintain the market’s growth in the face of heightened international competition was in music education and the live industry. The organization is urging the Labour government to press ahead with its previously proposed cap on secondary ticket resale prices, as well as secure a cultural touring agreement with the EU that will allow visa-free touring for musicians and crew.

In a statement, U.K. Culture Secretary Lisa Nandy called the country’s music industry “a real British success story” that is “vitally important” to driving overall economic growth. Nandy said she was committed to ensuring that the government works with the music industry to build upon its current success for years to come.

“By supporting vital grassroots venues, introducing new secondary ticketing protections for fans and ensuring all children can access high quality music education in schools, we can help the sector go from strength to strength in the future,” said Nandy.

Related

According to figures released earlier this year by U.K. labels trade body BPI, global superstars like Styles, Adele and Ed Sheeran helped British music exports climb to a record high of £775 million ($974 million) in 2023 based upon estimated label trade revenue — the highest annual total since BPI began analyzing labels’ overseas income in 2000.

UK’s Music’s This Is Music study uses a different methodology to report on export revenues, which it says climbed to a record high of £4.6 billion ($5.8 billion) in 2023, up 15% year-on-year. That export figure is based upon gross income generated overseas by British music companies and creators, including recorded music, publishing, brand endorsements, merchandise sales, international touring by homegrown artists and foreign visitors attending U.K. gigs and festivals (so-called music tourism).

The total number of people employed in the U.K. music industry grew 3% year-on-year to a record 216,000 full-time equivalent posts, reports UK Music.

Powered by Billboard.

Related Articles

Back to top button