Some nine months after the U.K.'s Competition and Markets Authority (CMA) revealed it was carrying out a market study into music-streaming services, the government department has revealed it believes there is no case to answer -- for now, at least.
The CMA already has a pretty full plate, as it's currently locking horns with Facebook's parent Meta over its Giphy purchase; investigating Google over its dubious role in the adtech stack; and lining up a possible investigation into Apple and Google's mobile duopoly.
In terms of music-streaming, the CMA had been tasked by a parliamentary committee with researching the state-of-play in terms of competition between the various music-streaming players, and their relationships with the so-called "big 3" major record labels -- and more importantly, whether any of this negatively impacts consumers.
In its preliminary market study report published today, the CMA acknowledges that the music-streaming market is dominated by a few companies, estimating that Spotify had the lion's share of the market with as much as 50%. It concluded that collectively, Spotify, Amazon, Google and Apple account for 95%-100% of music-streaming revenues.
Music-streaming market share in the U.K. Image Credits: CMA
On top of that, the report noted that the three major record labels -- Sony, Warner and Universal -- accounted for more than 70% of all streams in the U.K. last year.
However, the CMA noted that it saw no evidence that such a concentration among a few labels and music-streaming platforms was "currently causing consumers harm," or that any of the parties were making "sustained excess profits." In short, the CMA said that issues raised by artists -- such as poor compensation -- was not related specifically to competition.
"Technology is opening the door to many new artists to find an audience and music lovers can access a vast array of music, old and new, for prices that have fallen in real terms," CMA's CEO Sarah Cardell said in a statement. "But for many artists it is just as tough as it has always been, and many feel that they are not getting a fair deal. Our initial analysis shows that the outcomes for artists are not driven by issues to do with competition, such as sustained excessive profits."
While today's announcement isn't the CMA's final decision, having already conducted a fairly in-depth study drawing on feedback from myriad sources across the music industry, there would likely need to be some revelatory new information between now and the responses deadline on August 19 for it to reverse its decision.
The CMA's deadline for publishing its final market study report is January 26, 2023.