LONDON — The UK music industry is at a “tipping point” due to increasing competition from other international markets and the threat posed by unchecked productive Artificial Intelligence (AI), the head of umbrella organization UK Music has warned.
In 2023, the music industry contributed £7.6 billion ($9.6 billion) to the country's economy, up 13% from the previous year, according to the organisation's annual This Is Music study, which measures the economic impact of UK music industry across all income streams including live, record sales, publishing, merchandise, brand endorsements and public performance revenue for UK music creators and rights holders.
Big-grossing UK tours by Beyonce, Burna Boy and Harry Styles helped boost the record's financial contribution, said UK Music, which bases its calculations on estimates of the gross value of money generated by music sales, concerts , recording studios, tours and music tourism — roughly equivalent to pre-tax earnings and wages.
But despite a strong appetite for British artists and songs, the country's music market faces several significant challenges that threaten its continued prosperity, says UK Music. It identifies increasing competition from other international markets, difficult economic conditions for grassroots artists and music venues, and the potential risks posed by genetic artificial intelligence in music creation as the biggest risks to the industry.
According to export figures released earlier this year by UK label trade body BPI, UK artists now cumulatively account for less than 10% of global music streams, compared to 17% in 2015 The BPI says the UK's share of the global music market is partly due to it facing tougher competition from fast-growing international markets such as Latin America and countries like South Korea.
The UK's folk sector is also facing a number of well-documented financial difficulties, with around 125 small-capacity music venues set to close by 2023 and more than 350 currently at risk of closure, according to the charity Music Venue Trust (MVT). In addition, 60 UK music festivals have either been postponed, canceled or closed this year due to rising costs, slow ticket sales and bad weather, says the Association of Independent Festivals (AIF).
“We are now at a tipping point and if the issues we face are not addressed then future growth cannot be guaranteed,” said UK Music's chief executive Tom Kill in a statement on Wednesday (November 20).
Kiehl said that without stricter regulations the “wild west” of genetic AI could further undermine the UK's long-standing position as the world's second-largest music exporter behind the United States. Kiehl is calling on the UK government to move to implement laws that protect artists and rights holders from AI developers using copyrighted works to train their systems without permission.
UK Music also wants to see ministers introduce a legislative framework that would require tech companies to clearly identify music created with AI and keep records of works they've ingested, similar to those introduced by the European Union earlier this year in the AI Act.
Other areas where UK Music said urgent action was needed to sustain market growth in the face of increased international competition were music education and the live industry. The organization is urging the Labor government to go ahead with the previously proposed cap on secondary ticket resale prices, as well as secure a cultural tour deal with the EU that would allow visa-free tours for musicians and crew.
In a statement, the UK Culture Secretary Lisa Nandy called the country's music industry “a real British success story” that is “vital” to driving overall economic growth. Nandy said she was committed to ensuring the government works with the music industry to build on its current success for years to come.
“By supporting vital grassroots venues, introducing new secondary ticketing protections for fans and ensuring all children have access to high-quality music education in schools, we can help the sector build from strength into the future,” said Nandy.
According to figures released earlier this year by the BPI, global superstars such as Styles, Adele and Ed Sheeran helped Britain's music exports rise to a record high of £775 million ($974 million) in 2023 based on estimated revenue from the record trade – the highest annual total since The BPI began analyzing overseas label income in 2000.
The UK's This Is Music study uses a different methodology to report export earnings, which it says will rise to a record high of £4.6 billion ($5.8 billion) in 2023, up 15 % year over year. This export figure is based on the gross income generated overseas by UK music companies and creators, including recorded music, publishing, brand endorsements, merchandise sales, international tours by home artists and overseas visitors attending concerts and festivals in the United Kingdom (so-called music tourism).
The total number of people working in the UK music industry rose by 3% year-on-year to a record 216,000 full-time equivalent jobs, UK Music reports.
