Change is afoot in the music industry as French record labels and performers agree landmark deal for streaming remuneration

Readers may have followed the IPKat reports on the UK Music Streaming Inquiry, which focused on musicians and performers’ remuneration from streaming, or lack thereof, amongst other things. However, this conversation is not solely a national matter. It is clear that these issues are global and that there is a need for change at an international level in the music industry. 

Going 88 MPH
Image: Riana Harvey

In May 2021, the French government gave organisations representing performers and phonographic producers 12 months to negotiate an agreement guaranteeing “an appropriate and proportional minimum remuneration for artists” whose works are broadcast by streaming services. The deadline came after a 2015 initiative that sought an industry-led solution for a fair online music industry. The negotiations were mediated and no doubt the EU Digital Single Market Copyright Directive - which requires "appropriate and proportionate" remuneration for performers - also impacted on those ongoing talks.

Now, in May 2022, - much like most of us these days who only meet our deadlines in the eleventh hour– a historic agreement was reached between France’s main organisations representing record labels and performers/musicians. The agreement ensures that all performers will receive a minimum remuneration for the exploitation of their recordings by streaming services and provide a minimum royalty rate. It also embraces the principle of a minimum advance for featured artists, as well as, for non-featured musicians, a specific package for streaming with automatic additional remuneration when listening thresholds are reached.

In particular, the agreement includes the following,: 

• A minimum rate of royalties due to featured performers for the broadcast of their work via streaming; 

• A guaranteed minimum advance of €1,000; 

• A profit-sharing mechanism for the benefit of musicians when musical works reach a certain level of success; 

• A fixed remuneration for the benefit of all musicians; 

• A strengthening of FONPEPS - a private/public fund supporting employment 

• Increasing minimum fees for session musicians 

• Additional remuneration for artists, paid for by their record label, for every 7.5 million plays their song receives

Currently, revenue from streaming for featured artists depends on their recording or distribution contract. Non-featured performers – i.e., session musicians – are usually paid a one-off fee for their time and so do not usually receive anything more when the song is streamed. Therefore, these agreed changes will change the remuneration framework for both featured and non-featured artists from streaming.

Record labels’ organisation SNEP and neighbouring rights society SCPP, which represent majors and independent companies stated that: 

“This agreement establishes a new framework that adapts the relationship between performers and producers to the new uses of music consumption,” while at the same time “respecting the economic model of all music companies, regardless of their size, and their ability to produce and develop performers in France.” 

The Union of Independent French Phonographic Producers (UPFI) and the Civil Society of Phonogram Producers in France (SPPF), in a joint statement, said that they are “delighted that a balance has been found between the partners, which takes into account the wide variety of economic models and the different types of contract of independent production companies.” 

It added that “the royalty rates applicable to featured artists, as well as the generalisation of the advances from which they now benefit, are sustainable by all producers, including micro-enterprises.” 

How the changes will be implemented in practice will of course reveal the true extent of the impact of this agreement. Nonetheless, at this point, it appears that all the stakeholders involved in the negotiations are pleased with the agreement. 

Meanwhile, similar negotiations are on-going in the UK following the Digital, Culture, Media and Sport Select Committee Inquiry into the Economics of Music Streaming. The UK Government also called for a stakeholder group with the ambition of finding industry solutions. With the threat of legislation if no agreement can be found, and now with inspiration from the French, the stakeholder group should be encouraged to make progress in addressing the issues of fair remuneration for artists and performers from streaming. 

The take-home message is that we all agree the current streaming remuneration system is not fair to artists and performers, but that solutions can be found. Whether through copyright legislation or stakeholder-led agreements, it is time for things to change in the music industry.