Growth Slowing in the UK Music Industry

In the past few years, the music industry has enjoyed something of a resurrection in growth terms but, an increasingly fragmented market with fewer one-size-fits-all strategies for breaking new artists. This in turn has seen revenue growth begin to reduce, without a clear plan for addressing it. The phrase uttered in every terrible pub conversation, ‘AI, AI, AI’, looms over the UK music industry. Indeed, it is where streaming services are starting to look for cost shortcuts, and major labels are beginning to follow suit.

For example, deals have been signed with AI companies such as Suno and Udio. Not wanting to be left behind by emerging trends, as previously happened with downloads, this fairly immediate uptake neglects the longer term, more complex problem, which is that artists now take longer to become successful. One way in which this can be addressed is to appeal to society’s current nostalgia boner. Friedrich Nietzsche advocated that the concept of ‘time is a flat circle’, and we are experiencing a return to some old norms seeing more technology rejection: vinyl sales are increasing, and reunions from legacy acts are drawing in large crowds, all of which are important to capitalise on. Does this new ‘old’ climate and return to some past ways make it more difficult for new acts to emerge? It’s a hard balance to strike, developing upcoming talent vs risking the public becoming tired of the ‘same old acts’. Music’s strongest power has always been reinventing the wheel to create something novel, often more so than the original idea, so the answer probably lies in creating a healthy combination of both. 

Efforts can be increased through political channels to boost growth. A recent example of success, is that ticket touting has recently been made illegal in the UK, which could free up the cash of consumers to spend more on additional events, rather than the exorbitant amounts charged by touts. There are other long-term strategies which industry stakeholders can lobby for, these include:

• Government investments in the arts at a young age creates a stronger talent pool, and a more culturally interested audience.
• Investment in small venues: contributes to the wider economy, providing a fun time investment for young people, the use of third spaces for communities, and local tourism from villages etc.
• Levies on live shows: with the music industry becoming more fragmented, and success coming from a broader range of sources, this suggests smaller and medium sized artists and venues should have more invested in them, as they are more likely to be able to pay it back as a contribution to increasing revenues etc.
• Re-joining the EU: less friction in travel and lower costs for live shows.

Key Takeaway:
The music industry has done well to benefit from changes in modern technology, but it must be careful of new initiatives that take away from its soul. Yes, the money matters, but what truly underpins the business is how it connects to the listener.