In December 2020, Bob Dylan’s publishing catalogue, which consisted of some six hundred songs, was sold to Universal Music Group. The move drew headlines, with many fans surprised to see that the ownership of an artist’s musical works could be transferred over as part of a financial transaction. Recent years have seen similarly surreal moments in the music industry. The disappearance and then sudden reintroduction of Taylor Swift’s songs from streaming platform Spotify, is another instance that gave ordinary listeners a strange sense that the music they were listening to was not readily available for their ears, but bound up in a set of complicated, often irrational flows of a highly consolidated music industry.

David Turner is a former music journalist who writes the newsletter Penny Fractions, a regular newsletter that covers the music streaming industry. He has written about the financialisation of back catalogues, and the way that artists have become subject to the whims of the tech industry to survive.  

Common Wealth spoke to Turner after the news of a UK Parliamentary inquiry into the economics of music streaming. That move comes amidst a push towards ‘user-centric streaming’, [a model] which pays artists based on their share of each subscriber’s listening (rather than a flat rate per stream), and co-operatively owned platforms (like Resonate), all of which is suggestive of how controversial music streaming has become, particularly as part of a larger debate around the tech and the digital economy.  

The interview has been edited for length and clarity.

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Josh Gabert-Doyon

How did you become interested in these big-picture issues around music streaming?

David Turner

I got into music journalism as a fan of music, first as a music reviewer, [although] never writing with super flowery and descriptive language, that never was really my particular style. I did [music writing] in college and had a brief career doing that in my early 20s. And then in 2017, after I was let go for my job at MTV News and I started freelancing. I wanted to explore other topics and I thought there was some other things that could be cool - I mostly wrote about viral trends, and that led me to thinking a little bit more about the actual platforms and companies that run this stuff.  

The story that sparked this, honestly, was one about Spotify having fake artists on their platform. I just thought that sounded really funny. And then the more I researched into it, I found that it wasn't that they [Spotify] had fake artists, but that they had a company called Epidemic Sound that was supplying them with really cheap music. I got really obsessed with that and fell into a rabbit hole. After a couple more stories that came out later in the fall of 2017, I decided I would make a newsletter, which I called Penny Fractions. Penny Fractions is a riff on the fact that on a stream, artists are, in theory, paid on a fraction of a penny per stream, even though that in of itself was a bit problematic, and doesn't actually describe the actual issues of streaming really well.  

As for the newsletter itself, my thinking has changed a lot over the last few years. Originally, the newsletter was always sort of critical, but also a way to point out marketing trends, and even musical trends. I think it mirrors my own personal political shift, but around 2018, the newsletter started getting a bit more critical. And then last year I wrote this short chapbook, called New Music as a Solution to the Gig Economy, which was me trying to think through what a better way of envisioning music's whole political economy. Which is a very ambitious thing [laughs] and even though I only wrote a year ago, there's plenty of stuff in it I now disagree with. But it was a good thought exercise in trying to start from the root up. Like - where do I start with this? Live music needs to be somewhere incorporated into this, so where does housing start becoming part of this? It started getting bigger and bigger. This year, I've written a lot more about financialisation of the music industry and a lot more broader industry trends that I feel are very, very under covered. Even when you're reading historical records, this is not how music has been discussed.  


When people usually think about music and its political economy, they're usually thinking about artists, labels, and maybe streaming platforms. If you were to try and map out, as you do in Penny Fractions, the role of social media platforms and tech companies, how would you describe the current landscape and the way that ownership of music is evolving?


There are a couple of different chunks. I would start with the record industry, because just starting with records makes it a little bit easier than starting with tech, because you can get a little lost. There are the big three major labels of Warner, Sony, and Universal. The big thing about those three firms, which I've been thinking about a lot this year, is that Universal Music Group is owned by Vivendi, which is a huge multinational that owns a tonne of various entertainment companies, and Warner Music Group is owned by Access Industries, again, another giant multinational. Access Industries, also has a very big stake in Deezer, the French music streaming service. So just keep that in mind. Sony owns Sony Music Group, or Sony Music Corp.  Sony, Access, Vivendi – those are the main players of this sphere.  

But the next company that I would put at that level is Tencent Holdings, a giant Chinese multinational. And the other player I would put here is Liberty Media, which is another large multinational that owns or has large stakes in Sirius XM, iHeartRadio, Pandora, Live Nation, and they've invested heavily into JioSaavn, which is an Indian music streaming and live streaming platform (just for disclosure sake series, Sirius XM invested $75 million into SoundCloud, which is where I work at my day job). I see Liberty as a fifth pillar of all this, of the five main firms that constitute the music industry. Obviously, there are companies like AEG and other big live companies and CAA [Creative Artists Agency] and other bodies representing actors. But these to me are the big five.  

The reason I think this is that Access, Vivendi, and Sony are all intermeshed with Tencent, Spotify and Deezer – they all own some small percentage of each other. So, as I'm describing this out loud, I know this is probably not going to be legible, but that sort of describes the inter-tangled mush that is the record industry in 2020. This is something that I've been trying to think a little bit more about in the last few months.  

The only company that is outside of that main cluster is Liberty Media, but Liberty Media has stakes in big players like LiveNation and iHeartRadio, and JioSaavn, who, weirdly enough - through the Indian technology company that owns them - received a huge investment from Facebook earlier this year. The reason I want to mention Facebook is that one of the big new money-makers that I think we're going to start seeing in the record industry is Facebook, TikTok, and social media platforms, as those major labels I just mentioned, start getting deals with some of these other firms. Access, Vivendi, Sony and Tencent are, in the next few years, I believe, going to have a lot more stake in the Facebooks and TikToks of the world, as they start getting deals and having to fork over money.

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The missing piece of this, and the point you often start from with Penny Fractions, is the fact that the artists making music are getting very, very little. What's happened to the role of artists in all this?


See that's the thing - I just explained this big macro level picture and you're like where are the artists? Artists don't really factor into a lot of this. And I actually want to say that I don't think that's a new development - this is fairly consistent with the record industry. Of course, I'm speaking as an American, and as someone who's familiar with the American music industry, I know in other countries there has actually been a stronger labour movement, especially around musicians. But in the United States that peaked in the 40s, when the American Federation of Musicians (AFM) went on a number of massive strikes. They even went on strike during the Second World War, to try to get better pay-outs from the big labels at the time.  

What ended up happening, and this will get to why artists aren't in this equation, is that in the period after that strike, there ended up being a stylistic shift, where instead of music being bands and more classical, unionised work, it underwent a change. Because of recording, there's suddenly less radio jobs for musicians, there are less jobs for musicians playing for movie theatres because of recording and then also now you have those recording sessions themselves moving in a trend away from unionized work.  

This also parallels with the fact that the AFM was not very keen on introducing artists that could not read music. Like the Beatles – the AFM actually tried to actively keep the Beatles from coming to America, because they didn't want non-unionised musicians to come play in the United States. If we want to know why artists aren't in this equation, you can go and read trade publications, and you'll see that back in the in the 30s and 40s, unions are mentioned constantly. There's even discussion of union elections. And this extends beyond AFM, to the SAAG (Screen Actors Guild) and AFTRA (American Federation of Television and Radio Artists), and AGMA (American Guild of Musical Artists).  

There are a number of unions that still exist today, but they had a bigger role in the music industry during the early part of the 20th century, That is no longer the case, and that [weakening of the unions] ended up having this effect that, by the 30s and 40s, labels are signing are musicians, soon rock and R&B groups, both genres that didn’t have the historic connections to the labour movement. And if those ties are severed, suddenly you have to accept this bad contract. And it's like: "aren't contracts always bad?" And yeah, contracts may have always been bad, but at least there were other options at some point. It eventually just becomes that you have to take the shitty contract and that's just how things go, right?


I wanted to ask you about the Bob Dylan catalogue purchase, which was a big news item recently. You've called this kind of buying and selling of musicians’ catalogues as "the privatization of the American Songbook.” Can you tell me about the role financial institutions in music publishing?


Music Publishing is almost its own extremely confusing map. To give a brief rundown of music publishing since the 1960s, which was when we started seeing a slow hoovering up of smaller publishers, who had gotten their start in the early 20th century. A number of these larger companies that were buying up smaller ones were just industry bigwigs that had cash in the music industry, so it wasn't a bank or private equity company buying it, it was mostly people who were already successful in the industry. Now, there probably were bigwigs talking to banks and all that stuff, but that was essentially the main buyer.  

That continues in through the 70s, and then what happened is that in the early 80s there ends up being a couple of big deals. In 1983 the big one was that Freddy Bienstock (a guy who ended up helping to place Elvis's music into movies), along with the Rodgers and Hammerstein Estate (composers Rodgers and Hammerstein, who did Sound of Music) and Wertheim, which was a large investment bank, got together in 1983 to buy Edward B. Marks catalogue, a huge publishing catalogue. That, as far as I can tell, is one of the earliest purchases that explicitly needed banking support. Because if you go back and read other trade publication, accounts of purchases pre 1980s, they don't mention needing a bank to help facilitate. [This purchase] kicks off what basically becomes a mass consolidation of all the big publishing houses.  

To fast forward this to Bob Dylan, his catalogue was sold to Universal Music Publishing Group, which itself bought the Bertelsmann Music Group Publishing back in 2006, and Universal had [been formed] in 1998 [as a result of a merger] with Polygram's music publishing. Universal Music Publishing is one of the big music publishers, and they got their start in the 90s, basically, as part of a longer series of consolidation in publishing.  

You have these big publishers – Universal Music Publishing Group, Sony/ATV, and Warner Chappell, who are the Big Three of publishing, then you also have a number of more publicised financial groups like the Hipgnosis Songs Fund, like Shamrock capital, and maybe a dozen of other firms. These are all financed in various ways, Hipgnosis is a publicly traded company, some are private equity, some are sovereign wealth funds, some are pension funds.  

That's what's been happening over the last few decades. With Bob Dylan's case, the industry speculation, by which I mean what reporters in trade publications were saying, was that this was an offensive move done by Universal because they see all these other financial firms just gobbling up whatever is left.  

I think the reason this got so much attention is that it was the first salvo in major publishers, acknowledging that there's this new financial interest trying to secure these song rights. And thus, the price of catalogues is going to keep going up, up and up. We aren't just seeing [a scenario] where some account manager can convince the pension fund guys to invest in a song catalogue. It's now going to be the case where the biggest publishers are also playing a similar game and obviously everyone's pockets here are very deep. The increase in speculation should probably have a very solid shelf, at least for the next few years. There's very little reason to think that we've maxed out.  

Another thing that's interesting about the Bob Dylan news is that it wasn't officially reported how much it costs. Which is interesting because there's a desire to not know exactly how much a catalogue is worth, or how much it's really going for, because no one really actually wants to know how much money Kanye West's catalogue is actually worth. Because there are enough people crunching the numbers that are going to start looking at this and saying: "Okay, this is actually only going to be worth this much." No one wants that. No one wants it to be that transparent.  


The involvement of Carlyle and other big private equity firms seems really significant here.


One other good example, with the private equity point, from the earliest moments of private equity, at least that I could identify, was when Sony bought CBS Records in 1988. One of the groups that helped that helped finance that deal was the Blackstone Group. In 1998 in the New York Times, they mentioned the Blackstone Group as "up and coming" [laughs].  

This wasn't the first one, but an early instance of this was when a Dutch pension fund bought the Rogers and Hammerstein catalogue back in 2009, right after the financial crash. Still very much in the heady days of the crisis, in fact. Most of these investments really start post-financial crash – that's where it all kicked in. Because before the financial crash, we saw things like the Blackstone Group financing Sony’s purchase of CBS. The next big one was Bain Capital (shout out to the former US presidential candidate Mitt Romney) and a bunch of other private equity firms buying Warner Music Group. They just slashed it, cut so much out of it, and sold it a few years later for tons of money. The next big one was when Terra Firma [founded by UK financier Guy Hands] bought EMI in the UK, which happened to coincide, with the financial crash, right around late 2007. And that [purchase] scared folks for a second, because they were like: "Oh, wait, private equity getting into music is bad."  

I would love to see a written account of this, but private equity basically shifted their strategy. In the 00's, they were looking at record labels, but by the 2010, they were saying "no, we're not doing record labels, because record labels are hard." And it's true the record label business is finicky and kind of weird. All of a sudden private equity says they're not going to worry about record labels, they’re going to switch to music publishing where they can have good solid quarterly returns.  

Interestingly in recent years it’s become much more automated and that's another argument I try to make, is that the industry is basically on wheels. The CEOs of record labels are just there to sign deals with big tech firms, right? It's a whole financialised web where everyone's signing pieces of paper that say like: "I'll get $7, you'll get $2, I'll get $1, but also you'll get $5 of those $7 down the line."

It's also a way to invest in tech, that's the other very pernicious thing about it. Because how are record labels and music publishers making money? They're making money on Spotify, Amazon, Google, Apple, and then they're also making sync deals [where rights to music are sold for use on TV, films, or other media] and a lot of deals are again, Netflix, Amazon or Apple.


There's this problem of artists not getting paid enough – of getting paid penny fractions –  but there are also these other effects of the concentration of streaming platforms that are really taking a toll on artists. You mentioned “penny fractions” wasn’t the whole picture – I know one thing that you've written about before is the role of playlists. My sense is that platforms like Spotify are providing this infrastructure, in the form of playlists and they're claiming they're supporting artists, but this infrastructure is actually completely disconnected from the actual day-to-day of being a musician and trying to make money. How do artists get pushed out of the process?


Playlists are a fun one. Playlists are something I've written about, but I would also say that the writer Liz Pelley has written very compelling pieces on this.  

The effects of playlisting culture on artists, to me, is that they're a false signal. You can get placed on a playlist and then that means you could get 10,000 plays, but would that mean 10,000 new fans, or they're just 10,000 plays of someone that happened to hear your song for 30 seconds? The good example I saw on Instagram, was a fan account that said: "hey, our artists got 3 million listeners on Spotify this year, you're one of them." But it's like: “wait a minute, I'm pretty sure this artist doesn't have 3 million fans.” I've seen them play sold out shows to 1000s of people, but they don't have that many fans.

I would compare it to radio. If you think of radio, the idea is that a song goes on the radio and then moves upwards, so that artists can reach a broader audience. Radio has issues like Payola [where labels, managers, or artists pay for radio spins], and radio is problematic in many ways. But one thing that at least makes sense about radio is that if a song was popular, you can make money off of it.  

A few years ago, I wrote about a station in Greensboro, North Carolina that broke a bunch of big rap song. If a rap station in the middle of North Carolina plays a song, they have to know that's doing well with their audience. And from reporting, I know that a number of those [radio] DJs will be pulling songs they heard from clubs. This is starting with someone going to a nightclub, seeing hundreds of people going wild to a song, and then saying, "oh, I should play that on my radio show." They play it on the radio show, and then if it travelled, it's traveling to maybe another city in the state. But it's not that the song is traveling, because more than likely if the DJ or nightclub is playing it in that one city, a DJ and a nightclub are also playing it in another city. And then the same recurring effect starts going, and all of a sudden, the song that started in the middle of North Carolina makes it all the way to Georgia. And now it's gone through three states, hit different nightclubs, and different markets. And then all of a sudden, I start hearing this song playing from cars that are driving around New York City.

Obviously, songs go viral on the internet, on Instagram or TikTok, and that creates a very similar effect. But when you don't have the infrastructure, then there's no touring. Because an artist, again, that started in North Carolina and made its way through the South, those are tour dates for you, those are meet and greet, those are places where you can go to sneaker shops and have events.  

Going from a playlist to a playlist to a playlist doesn't replicate that at all. There's no constituency for those playlists. Those constituencies are more than likely all subsets of that bigger playlist. And then thus there's no actual path to that. And there's no path in those playlists to understand where those fans are and what those fans might be doing, and how do I interact with those fans in a way that can get me money? You can't, really.


From your perspective, what kind of policies would you want to see to reshape streaming industry? What would be your wish-list?


That's the thing that's kind of funky to me about this. In music I feel that there's a lack of coherent vision amongst folks that think about these things. In other parts of left thought there's a more coherent vision – in music, it's really a grab bag of whatever your personal vanity project [might be]. For me, I think there needs to be more investigation into [that vision].  

This is maybe more on the American side, but I think more oversight of Spotify's acquisitions. Spotify has bought a number of podcasting companies in the last few years. So questioning those acquisitions, and then going back to those firms I mentioned earlier, Access, Vivendi, Sony Tencent, and Liberty. Antitrust if Americans could care about that, it'd be great. That trickles downward to the label themselves. Warner, Sony and Universal probably shouldn't be able to operate across the globe in the manner that they do. This is mostly me asking for breakups.  

A lot of the investigation on streaming is looking at renumeration and how much money they're actually paying out. And I understand from a more strategic point of view, and I understand it coming from the UK musician's union, who have a solid constituency and understand that they can work this to get more pay-out for their artists, and that makes total sense. I support that. As an American, I love to see it and think that it's extremely good. These initial conversations may not lead to what I was just talking about [in terms of breakups], but at least it starts the conversation.  

There's been talk about this idea of user-centric streaming. I know that's been champion by the UK musicians’ union. That's something that, in theory, I think is fairly cool and interesting. It breaks up the political economy issues of music in some way. Although it doesn't get to the bigger, macro stuff at the multi-national firm level, it does undermine a lot of the current stuff – like playlisting – and I find it very exciting, honestly.  

On the policy side I'd be curious to see more investigation into the question of when we need to start calling out consolidation. I'm interested in investigating if there's something we can do to address private equity's role in music publishing. It’s hard to think through it because it's very new, but it’s a big concern. And I'm sure there are other folks that have better thoughts on this than I do, but why do we let pension funds invest in this stuff? Once I realized that music catalogues were a place for Florida pensioners, I realised that things are not going right in the world. Why do they feel a need to invest in Taylor Swift's catalogue? That's a problem. The New York State Pension Fund just divested from fossil fuels. And the New York State Pension Fund was worth $226 billion. People talk about how much money Jeff Bezos and some of these firms are worth, but actually pension funds are absurdly big, and their money has for the last number of decades just been going into the worst things. In the music context, can we just not have [the commodification of catalogues] ever, or can we have pension funds as some kind of way to invest back in the arts? But even that seems in of itself very problematic.

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