European streaming is organized into a lobby

The main European platforms of music streaming were gathered Monday in Brussels for the creation of “Digital Music Europe”, a lobby to defend their interests with European decision-makers and unite against the American competition.

Enemies in the business, united in the lobby. Deezer, Spotify, SoundCloud, Qobuz … The flagships of European streaming were gathered Monday in Brussels for the official launch of “Digital Music Europe”, a lobby to defend the interests of music streaming platforms in Europe. The goal: to collectively weigh with the European authorities, but also to unite against American competitors like Apple Music.

“In 2016, the music market grew by 4% in Europe, something that has never been seen in 20 years, thanks to streaming … And all these companies that are growing this way are European”, said Hans-Holger Albrecht, Director General of Deezer and President of the Alliance. “Europe has been a pioneer in digital music.”
The initiative brings together the French Deezer, Qobuz – specializing in high quality sound – and Soundcharts, a data analysis platform for the music industry. It also includes the Swedish leader Spotify, SoundClound and the UK platform 7Digital.

Copyright reform, geoblocking, data …
The alliance wants to invite itself in several debates on pending European reforms, such as copyright, the use of user data or geoblocking. To protect copyright, this method limits the use of a streaming service in the country in which the user resides. On the road to a single digital market, the European Parliament, the Commission and the Member States reached an agreement in February 2017 establishing the end of the geoblocking of streaming services.

This will allow “anyone who has subscribed [in his country] to listen to music (…) to do the same when traveling to Europe”, then congratulated Andrus Ansip, vice president responsible for the digital single market. The measure, which has not been adopted definitively, still needs to be discussed by the Council and the European Parliament by the end of the year. If implemented, this reform would allow European users to have access to all content on the platforms, but for prices that may be double the price. For example, a Spotify Premium subscription costs 9.99 euros in France – compared with around 4.80 euros in Poland.

112 million subscribers worldwide
Digital Music Europe also wants to examine the relationship between streaming platforms and its intermediaries, such as application stores (App Store, Google Store) and virtual assistants. For example, to access a streaming platform on your smartphone, you need to download the app from the App Store or Google Store. As a result, these intermediaries “serve as interfaces between the user and the music service, and the streaming platforms are becoming increasingly dependent,” said Olivia Regnier, Spotify’s director of European affairs. “There must be fair competition, which goes through the regulatory environment,” said Hans-Holger Albrecht.

In 2016, streaming took off with revenues up 60.4% and 112 million subscribers to online music services worldwide, according to the annual report of the International Federation of the Phonographic Industry. In France, the digital market generated € 182.6 million (+ 19.5%) and 3.9 million subscribers (+ 42%), according to the National Union of Phonographic Publishing.

This trend has allowed the global music industry to return to sluggish growth, due to the steady decline in physical sales despite a small return of vinyl. Despite their popularity, streaming platforms are still fumbling for a viable business model.

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