Art-ificial intelligence: Why AI isn't the only tech challenge for the future of artistic expression

From press outlets dissecting articles written entirely by ChatGPT to David Guetta deploying a deepfake Eminem verse in a new song, it’s been impossible to ignore the headlines surrounding artificial intelligence of late.  Now, as someone whose childhood years were ...

Digital Discourse: Five key issues for the industry in 2023

Deviate Digital's CEO guides you through the ever-changing tech world.  In her latest column, Sammy Andrews looks at five big talking points for the year ahead... CREATOR WARS BEGIN It’s been a difficult 12 months for many technology companies globally with tumbling share prices and mass layoffs, but social platforms have started with refreshed approaches to their creator acquisition. At times this has involved hard cash in exchange for a few native posts, but for YouTube, creators now receive a share of advertising revenue from YouTube Shorts. YouTube have said that, by adding together revenue from adverts running between Shorts, this new monetisation plan will be used to both “reward creators and help cover costs of music licensing”. If a monetising creator uploads a Short without any music, all of the revenue associated with the video’s views goes into the Creator Pool. Alternatively, if a monetising creator uploads a Short that features music, revenue received from the video’s views will be split fairly between the Creator Pool and the music partners involved, dependent on the number of tracks used. “For example, if a monetising creator uploads a Short with one track, half of the revenue associated with its views would be allocated to the Creator Pool, and the other half used to cover the costs of music licensing,” YouTube have explained. “If the Short features two musical tracks, one third of the revenue associated with its views would be allocated to the Creator Pool, and the other two thirds used to cover the costs of music licensing.” The question is: will TikTok follow suit? TikTok currently pays creators through its Creator Fund, a pool of $200 million which was launched back in 2021 with a promise to reach $1 billion in the next three years. That might sound like a lot of money, but if you compare it to YouTube who claim to have paid creators over $30 billion in advertising revenue over the last three years, it’s most certainly not. Monetising short- form content has always posed a few questions, as you can’t very well just slot a 10-second advert into a 30-second video. However, it has become clear that YouTube are leading the charge with advertisement revenue splits. Expect land grabs galore in 2023. A MATURING STREAMING MARKET In January, the Entertainment Retailers Association announced that music sales grew by 3% in 2022, to their highest level since 2003 and nearly double the level of their low point in 2013.  The main driver of this growth (quelle surprise) was streaming, where revenues grew by 5%. Vinyl album sales increased by 11% and CD album sales fell by 17.4%. This is the first time that vinyl has outsold CDs in value since 1987. Are we reaching a point where a mature streaming market is slowing down? We most certainly are. Do we need to be looking ahead to new formats and monetisation routes? Definitely. NEW FORMATS, CONSUMPTION AND REVENUE GENERATION In regards to the conversation around streaming maturity, the music industry has been looking across social media, fitness and Web3 for advancements in formats and fairer monetisation for rights-holders. This year, I expect there to be many public and behind-closed-doors debates around how (and when) this will be achieved.  I am expecting debates throughout the year regarding how we can successfully monetise new and emerging formats Sammy Andrews We can clearly see some industry frustration with specific social platforms on revenue generation and distribution, but we can also see other socials making plays to appease the wider entertainment and creator communities. However, unless the industry stands together to find a fair way forward, I am expecting debates throughout the year regarding how we can successfully monetise new and emerging formats. CONTRACT UPDATES AND FAIR TERMS FOR THE FUTURE Speaking of new formats, something I’m hearing more about everyday is artist and songwriter communities questioning how fairly they are being treated, or will be treated, for their streams that technically, in their contractual terms, may not yet class as streams or sales. The industry must be sure to tread carefully as we explore new ways to drive the business forward so that we are able to fairly compensate our artists and songwriters every step of the way. IPO RESULTS Of course, while all of this takes place, we await the results of the Intellectual Property Office working groups around data and transparency. The UK government representatives on the last DCMS Committee streaming inquiry meeting noted that there was a lack of working groups around any form of remuneration.  Whilst many in our business will be glad about that, with such significant changes on the horizon we must ask: at what point will the elephant in the room be addressed?  

Centre Stage: Mark Davyd

A New Year’s Resolution for the live music industry: from January 1, 2024, no show should take place in any major arena, stadium or festival where the ticket doesn’t include a contribution to the grassroots circuit that supported the artist in building their career. We have 12 months to plan, let’s make it a reality.  At Music Venue Trust we’ve bounced straight into 2023 all guns blazing, determined to tackle the underlying challenges that our grassroots circuit has been facing for decades. The first part of that work started late last year when we hosted colleagues from the Department for Digital, Culture, Media & Sport at two of London’s finest grassroots venues – Corsica Studios and The Lexington. Both have their own stories, but it’s their current circumstances, the way they operate and the restrictions on their ability to support new artists that should concern us most. Corsica Studios is surrounded by building developments that are simply inappropriate to be built around a thriving grassroots music venue. There are huge holes in the ground both in front of and behind the venue, waiting for tonnes and tonnes of concrete to be poured into them to create housing. The developments are so close that the venue will have to move, a complex negotiation that still hasn’t been adequately settled. Corsica has been at the heart of live music in its community for over a decade, but there’s never been a time when the venue felt its future was safe or free from landlords and developers. The Lexington, on the other hand, is thriving despite an ongoing problem with neighbours and some extraordinary demands on the team there to manage the streets on behalf of the local authorities. However, the nature of how it thrives as a business is a prime example of the challenges the grassroots sector is facing. The venue loses money on live music and relies on the fantastic downstairs bar and club nights to keep the live music offer alive. How bad are the economics of live music at this level? To fill their nights with new music and to support promoters, both of which are essential to the future of our industry, The Lexington charges less than a third of the cost of opening the venue as a hire fee. If they didn’t do that, there wouldn’t be any live music. The venue is investing hundreds of thousands of pounds a year into live music with no prospect of return on that investment.  The DCMS meetings were enlightening for everyone involved. We’re currently drawing up a report covering 17 areas of government and public policy which could enable more supportive environments for grassroots venues and artists. They include obvious things like tackling the highest rate of VAT on ticketing in Europe, to measures such as a Statutory Duty Of Notification and Right Of Comment on planning applications being granted to Music Venue Trust. The government, or at least our DCMS colleagues, are genuinely engaged with what they can do to overcome the challenges the sector faces.  But the government keeps coming back to the same question, ‘What is the industry itself doing to tackle these issues?’ The answer is, we aren’t doing enough. We can’t go on pretending that everything is fine while the foundation stones of how we build talent in the UK are chipped away. Bluntly, we can’t go on making incredible profits from successful artists that came through a system which we are also allowing to crumble. There are eight new arenas proposed to be built in the UK across the next five years. Not a single one of those proposals commits to ensuring that the new venue’s success will support the grassroots circuit creating the talent.  There are 22 live music arenas and more than 30 major stadiums or festivals in the UK. Not one of them has a mandated contribution to the grassroots circuit within their ticket price. We have service charges, maintenance and restoration levies, but not the one thing we absolutely must have: an investment into our future.  In the UK, we have enjoyed years of free research and development carried out by venues like Corsica Studios and The Lexington at their sole expense. That period is now ending. I’m putting you all on notice. It’s over.  It can end by the UK live music industry working with Music Venue Trust to recognise the value of it, work towards a financial support package for it, and take responsibility. We can do that in a method we collectively control and manage as stakeholders. Or, it can end by the government, this one or the next one, becoming fed up with reading about live music venues in their constituency being closed down and taking action to make the industry take responsibility. The time to do it is now, before it is done to us. January 1 2024. There’s your deadline. Resolve to get it done. 

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