UK Antitrust Regulator to Probe Music Streaming Market

UK Antitrust Watchdog to Examine Music Streaming Market

The United Kingdom’s competition authority is preparing to initiate a thorough review of the music streaming sector.

CMA Announces Market Study

The Competition and Markets Authority (CMA) has announced plans to conduct a market study focused on music streaming services. This action represents the latest effort by the CMA to foster increased competition within digital markets.

Market studies are utilized by the CMA to pinpoint competition and consumer-related issues. Subsequently, the authority assesses the most effective strategies for resolving these problems, if intervention is deemed necessary.

Potential Implications for Industry Giants

This development carries potential consequences for the operational practices of mobile application stores and prominent music streaming platforms, such as Apple Music and Spotify, within the UK. This is contingent upon the CMA’s decision to implement corrective actions.

While the precise parameters of the study are still being defined, the regulator communicated to Members of Parliament its intention to prioritize this undertaking.

Parliamentary Concerns Spark Investigation

The move follows a report issued by a parliamentary committee earlier this summer. This report highlighted concerns regarding the economic dynamics of the music streaming market, including the potential dominance of major record labels.

Specifically, the committee raised questions about contractual arrangements between labels and streaming services, suggesting these agreements could potentially hinder innovation.

Government Request for CMA Review

Last month, the government formally requested the CMA to investigate the economics of the music market. This request stemmed from the DCMS Select Committee report and aimed to delve deeper into issues of transparency and fairness.

CMA CEO Statement

In a statement released today, Andrea Coscelli, CEO of the CMA, stated:

“The CMA is actively expanding its expertise in all aspects of the digital landscape. It is poised to assume a broadened role in overseeing the digital realm as the government progresses with reforms to digital competition rules, addressing concerns about the influence of large technology companies.”

Digital Markets Unit Established

A Digital Markets Unit has already been established within the CMA. This unit is awaiting legislative action to fully empower its capabilities. However, the CMA has proactively begun its work, independent of these pending reforms.

Previous Market Studies

The CMA previously conducted a study of the online advertising market. This investigation revealed a number of concerns that are now influencing the government’s efforts to reshape the UK’s digital competition regulations.

Furthermore, the CMA intervened to temporarily halt Google’s plans to phase out third-party tracking cookies. This action resulted in commitments from Google regarding the functionality of its proposed “Privacy Sandbox” alternative. This investigation is currently ongoing.

Ongoing Investigations into Apple and Google

Earlier this year, the CMA initiated a market study examining the dominant positions held by Apple and Google within the mobile ecosystem. Simultaneously, Apple’s App Store is currently under investigation by the regulator.

EU Action on Music Streaming

In Europe, regulators are somewhat further along in their examination of the music streaming market. In April, the European Commission formally charged Apple with violating antitrust regulations related to competition within the music streaming services sector.

Spotify’s Complaints and EU Focus

Spotify, a European music streaming competitor, had previously voiced concerns about Apple’s terms and conditions, deeming them “unfair.” However, Margrethe Vestager, the EU’s competition chief, clarified that the case is not specifically about Spotify.

Instead, Vestager emphasized that the focus is on the conditions Apple imposes on all music streaming providers seeking to reach customers through its App Store.