CMA to probe music streaming

The UK competition watchdog is launching a preliminary investigation into music streaming, it was announced on Tuesday.

The Competition and Markets Authority said the music industry had changed “almost beyond recognition” over the last decade, with streaming services such as Spotify accounting for 80.6% of UK music consumption, according to the trade body BPI.

It therefore planned to launch a market study into the sector “as soon as possible”, once its final scope had been agreed.

Market studies are used by the CMA to identify any potential competition and consumer issues within a sector. They can also consider how best to tackle issues highlighted by the investigation.

Andrea Coscelli, chief executive of the CMA, said: “The UK has a love affair with music and is home to many of the world’s most popular artists. We want to do everything we can to ensure that this sector is competitive, thriving and works in the interests of music lovers.

“Over the past decade, the music industry has evolved almost beyond recognition, with streaming now accounting for more than 80% of all music listened to in this country. A market study will help us to understand these radical changes and build a view as to whether competition in this sector is working well or whether further action needs to be taken.”

The proposed study is the latest in a series of moves by the regulator to tackle competition in digital markets. It is currently investigating Google’s Privacy Sandbox, Facebook’s use of advertising data and Apple’s Appstore.

Separately, is also investigating Sony’s $430m acquisition of artist and label services provider AWAL.

Market studies can lead to a range of outcomes, from making policy recommendations or taking enforcement action against individual firms, to giving sectors a clean bill of health.