MPs and music industry bodies criticized the salary of Sir Lucian Grainge, Chairman and CEO of Universal Music Group (UMG), who is expected to earn more in 2021 than all UK songwriters combined from of their music flows and sales in 2019.
Grainge’s salary this year is supported by one-time cash bonuses totaling around Â£ 123million, following UMG’s successful IPO in September and the sale of an additional 10% stake in UMG to the Chinese company Tencent.
They could push its total revenue for 2021 to over Â£ 150million, the figure that the Intellectual Property Office, a UK government body, has calculated, using average royalty rates, that composers and lyricists have calculated. Brits won in 2019 thanks to streaming, downloads and sales.
Conservative MP Esther McVey said: âIt is shocking that record company owners earn more from the works of artists than the artists themselvesâ¦ the notion of fair pay for a fair day’s work.
She expressed support for a change in copyright law relating to music streaming that would further align royalty payments with how payments are made for radio selections. This would change the current system, where streaming royalties are set through agreements between streaming companies and record labels.
In addition to touring and merchandise income, songwriters and performers have other potential sources of income besides streaming royalties, such as the rights they earn from their music played on the radio or in public, or licensed for use elsewhere. But that income tends to lean toward top performing artists, and many musicians have complained that the switch to streaming and ditching physical sales hurt their earnings.
Labor MP Jo Stevens, fictitious Secretary of State for Digital, Culture, Media and Sport (DCMS), said: ‘When music lovers stream their favorite tunes, they expect those who made it. music is paid fairly. But the reality is that artists are getting a pitiful amount while streaming sites and record companies are taking it. She also called for a change in the law.
A multi-party group of MPs presents a bill for consideration in parliament on December 3, titled Copyright (Rights and remuneration of musicians, etc.), which will propose the suggested legislative changes. Last month, 44 Conservative MPs led by McVey signed a letter calling for change, saying: âThese huge multinational corporations often owned by foreigners did astronomy last year relative to artists. In April, a group of musicians including Paul McCartney and Kate Bush supported the change in legislation.
The Union of musicians and body of songwriter the AcadÃ©mie des Ivors also voiced criticism of Grainge’s salary. Crispin Hunt, President of The Ivors Academy, said: âThis is proof of a business that is completely out of control. For songwriters struggling for a living, there is only one word for it: obscene.
In a quarterly earnings announcement last month, UMG’s revenue grew 17.4% year-on-year. Investors reacted with confidence to the company’s listing on the Euronext Amsterdam stock exchange in September: its shares jumped to â¬ 25.10 from a benchmark price of â¬ 18.50 on the first trading day, and are currently valued at â¬ 26.98.
Speaking to the company’s investors on the earnings call, Grainge – who did not comment on criticism of his salary – predicted âan unprecedented opportunity for further growth. As fans now have access to virtually all of the music in the world in the palm of their hands, and consumer demand for music across cultures, eras, languages ââand genres is at historic levels, I remain unwavering in my confidence that the path we ‘re will lead us to greater heights.
He acknowledged the difficulties with streaming for artists: âWhen every day around 60,000 tracks are uploaded to Spotify alone, the reality is that it’s harder than ever for artists to cut through all the noise to find and expand their audience. This is exactly why we place the highest priority on maximizing opportunities for artists to bring their music to the world and to connect with fans in increasingly rich ways. “