UK live sector gives mixed reaction to 2021 budget
The UK’s live music industry has given a mixed response to chancellor Rishi Sunak’s budget, unveiled today (27 October) in the House of Commons.
The chancellor, who upgraded this year’s economic growth forecast from 4% to 6.5%, pledged an additional £850 million in culture sector funding, the majority of which is ring-fenced (including £2m earmarked for a new Beatles attraction on Liverpool Waterfront), alongside temporary business rates relief in England for eligible retail, hospitality, and leisure properties for 2022-23, worth almost £1.7 billion.
The government is also freezing the business rates multiplier in 2022-23 – a tax cut worth £4.6bn over the next five years, and has increased the headline rate of orchestra tax relief.
However, calls to extend the VAT break on tickets sales beyond next March fell on deaf ears, and no improvements to the government’s £800m insurance scheme for live events were forthcoming. In addition, no cash was allocated to help the sector deal with Brexit’s impact on touring, while the absence of the word ‘music’ from the budget document left a sour taste.
“We’re glad to see that live music will receive some benefit from today’s spending review – including tax relief, business rates, and some extension in terms of funding,” says a spokesperson for trade body LIVE (Live music Industry Venues and Entertainment).
We need government to give us the tools to make progress, which were, unfortunately, missing from today’s news
“However, with the word ‘music’ completely absent from today’s announcement, we remain steadfast in our drive to see government pay attention to the key issues we are facing: the impacts of Brexit, the recovery from Covid and the long-term growth of the sector. We need government to give us the tools to make progress, which were, unfortunately, missing from today’s news.”
It remains to be seen whether music will be eligible for the £52m of government funding set aside for museums and “cultural and sporting bodies” next year to support recovery from Covid-19, with an additional £49m allocated for 2024-25.
“We look forward to hearing more detail about some of the measures announced by the chancellor today, in particular the allocation of further Covid-19 recovery funding for the cultural sector,” says Association of Independent Festivals (AIF) CEO Paul Reed. “On the surface, however, it doesn’t go far enough in supporting our truly world-leading festival industry.
“It is clear that the most effective way for the government to support the industry’s recovery into 2022 and beyond would be to extend the VAT reduction on tickets, look closely at a permanent cultural VAT rate, and completely remove festivals based on agricultural land from the business rates system. Unfortunately, none of this was forthcoming today.”
Referencing UK Music’s latest This Is Music report, which revealed the impact of Covid-19 wiped out 69,000 music industry jobs – one in three of the total workforce – the organisation’s CEO, Jamie Njoku-Goodwin, says further action is needed to support the music sector’s post-pandemic recovery.
“It is crucial that we get government support to help us continue to rebuilding and hiring people who went so long without work due to the pandemic,” he says.
“Covid halved music’s economic contribution to the UK economy from almost £6 billion a year to £3.1 billion in 2020. If the government strikes the right note by delivering the support we need, our music industry will come back stronger and bigger than ever.”
The government has missed an opportunity
Setting out a three-point plan to boost the business, Njoku-Goodwin adds: “We are pleased to see the extension of the orchestras tax relief yet the government has missed an opportunity to not take forward further music tax incentives to help boost jobs and economic growth. Similarly, business rate relief for venues is very welcome yet we remain concerned about next April’s VAT hike for live events.
“Ministers must put turbo-chargers under the efforts to clear away the barriers that are still making it so hard and expensive for musicians and crew to tour easily in the EU. As the domestic music market recovers, the government should also build on recent trade deals by giving more funding and support for music exports.
“As well as music’s huge economic and cultural importance, we also need to see the government fully recognise its huge value to our wellbeing by properly funding music education to help nurture our talent pipeline and provide the stars of the future.”
AIM CEO Paul Pacifico welcomes new measures for venues and hospitality, but stresses the importance of a tax relief scheme for music.
“It’s encouraging to see the government recognise the serious blow Covid dealt to the UK’s music industry in today’s budget, discounting business rates for music and other hospitality venues and for premises improvements and green tech use as well as increasing tax reliefs for orchestras,” he says.
“However, more must be done to support the globally significant independent music sector to ensure a viable future for diverse music, creators and entrepreneurs. One key proposal is a tax relief scheme for music, like those successfully implemented in other creative industries such as film and games. This cost-effective measure could provide our sector with the boost it needs, attracting inward investment and creating a ripple effect across the wider music ecosystem. We urge government to include music in such schemes at the next opportunity.”
There were also contrasting emotions from Night Time Industries Association (NTIA) chief Michael Kill.
“The improved forecasts for growth announced by the chancellor today are good news, and the reopening of the night time economy has been a key part of this better-than-expected bounce back,” says Kill. “We were disappointed that the chancellor chose not to extend the 12.5% rate of VAT on hospitality – this is a missed opportunity, and it will prevent those forecasts from improving further still.”
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UK associations respond to election results
The major UK music industry associations have given their verdict on yesterday (13 December)’s general election, which saw the Conservative party under Boris Johnson win the largest majority since Margaret Thatcher in 1987.
Johnson’s victory also ends the deadlock in parliament over the terms of Britain’s exit from the European Union, with ‘Brexit’ now almost certain to go ahead as planned on 31 January 2020.
Michael Dugher, the outgoing CEO of umbrella organisation UK Music, congratulates the new government on its victory and outlines his key music-industry concerns ahead of Johnson outlining his legislative agenda.
“Congratulations to the newly elected government. Hopefully this will now deliver the stability we need to get things done, including a new and comprehensive strategy to support music,” says Dugher.
“It is vital that the Prime Minister makes securing a trade deal with the EU a top priority. That deal needs to ensure that artists, creators and everyone involved with the UK music industry can move around the EU to do their jobs. It must also make sure that we have a legal framework to make the UK the world’s best place to make content. Copyright should be protected and enhanced in any new trade deals. […]
“Ministers also need to make good on their pledge to help protect small music venues by delivering on their pre-election promises to cut the soaring business rates bills faced by so many venues.
“Ministers need to make good on their pledge to help protect small music venues”
“We look forward to the speedy appointment of a new secretary of state for the Department for Digital, Culture, Media and Sport. We desperately need some continuity in that post and UK Music stand ready to work with them to ensure our world-leading music industry goes from strength to strength”.
The Creative Industries Federation, which represents the UK’s creative-industry businesses, says it will also “continue to work tirelessly” alongside the incoming government “to ensure that they act on the areas that matter most to the UK’s creative industries and our country’s emerging talent.”
On the Conservative party specifically, Alan Bishop, the federation’s chief executive, similarly notes that its manifesto includes promises to introduce “business rates relief for music venues and cinemas”, as well as to continue to support for existing creative-sector tax reliefs. “We look forward to working with government on these commitments, ensuring that industry is able to shape these initiatives so that they develop in the right way for the creative industries,” he says.
In the recorded music sector, the British Phonographic Industry (BPI) emphasises that the UK must maintain its commitment to protecting music copyrights when it leaves the EU on 31 January.
“The UK has a strong copyright regime. It is essential that this remains stable and the framework is not reopened in the event of the UK leaving the European Union,” reads a statement from the organisation. “The UK should bring forward measures to resolve the value gap in the UK and should ensure that the UK regime is an environment that will encourage investment in new recordings. […]
“It is essential that trade deals maintain a strong copyright regime”
“If any trade agreements follow as a result of the future arrangements between the UK and the EU, it is essential that trade deals maintain a strong copyright regime. It is critical to resist ‘fair use’ rules such as those found in the USA.”
The BPI also calls on the new government to commit to “reciprocal arrangements [with the EU countries] on visa-free travel, including for work purposes, [which] would ensure musicians will be able to work, tour and collaborate across the EU.”
Geoff Taylor, chief executive of the BPI, which represents the UK’s record label community, and the Brit Awards, welcomes the new Johnson ministry, says he looks forward to working with ministers on music industry related issues.
“This clear result should help move the country beyond the Brexit impasse and provide the UK with a much-needed period of political stability,” he comments. “We hope the government will use this platform to deliver a trade deal with the EU that minimises barriers to trade, including simple travel arrangements for UK performers, and new trade deals with third countries to boost our music exports.
“The UK music industry is a fantastic success story both here at home and around the world. If the relentless creativity and commercial ingenuity of our artists and labels can be backed by the incoming government with some simple but effective support, we can take this success to the next level, growing our international trade, supporting access to music in schools, and boosting the industry’s contribution to employment and the economy by better protecting the valuable IP we create.
“We congratulate the new administration and we will be actively engaging with them on this agenda.”
“We urge the incoming government to listen to the music sector”
Paul Pacifico, of indie label body the Association of Independent Music (AIM), says the Conservatives’ “strong majority” presents the opportunity for a “fresh start” as Britain prepares for its EU exit. “We know from this result that the process towards Brexit will now accelerate,” he explains. “It is AIM’s priority to ensure our members are as prepared as possible. The unfortunate truth is that the grassroots SMEs and entrepreneurs of our economy face the greatest impact [from Brexit] on their businesses, so we call on this new government to give our members the support they need to ensure we avoid a Brexit that just suits big business.
“With a strong majority and the opportunity for a fresh start, we look forward to engaging with the new government across our key issues for creative entrepreneurs in music, including copyright and support mechanisms for small business in our sector, which is so important to the UK both in terms of commerce and culture.”
Deborah Annetts, chief executive of the Incorporated Society of Musicians (ISM), draws attention to the associations pre-election ‘Manifesto for Musicians’, which said the UK must strike a deal with Europe “which will protect every aspect of the musician’s working life post-Brexit”.
“This,” she says, “includes everything from a two-year, multi-entry visa, to ensuring that musicians can take their instruments easily across the channel to work in the EU.”
“As only reported this month, the music industry is continuing to grow and is now worth £5.2bn,” Annetts adds. “We urge the incoming government to listen to the music sector and ensure the future of this prosperous industry is protected.”
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Allen Kovac celebrated at AIM Independent Music awards
Rock impresario Allen Kovac was presented with the prestigious innovator award at the AIM Awards at the Roundhouse in Camden, London, tonight (3 September).
Kovac, the founder and CEO of Eleven Seven Music Group (Mötley Crüe, Papa Roach, Five Finger Death Punch), has also worked with artists including Duran Duran, Meat Loaf, the Bee Gees, En Vogue, Luther Vandross, Nelly Furtado, the Cranberries and Blondie over five decades in the business.
He was presented with the award by Helen Smith, executive chair of the Independent Music Companies Association (Impala), while Virgin Group founder Sir Richard Branson sent a personal message.
“I’ve known Allen since the early 90s,” said Branson. “Allen was managing Meat Loaf, whom Virgin Records had signed and Allen was pushing myself and the Virgin team to allow Meat Loaf to upload one of the first songs to the fledgling internet. As innovators, we would do anything for music, and of course, we did just that.
“From humble beginnings as a promoter, Allen went on to be a manager of the Bee Gees, Blondie, Mötley Crüe, Duran Duran and the Cranberries, and then started Eleven Seven Music which is now, 12 years later, one of the top rock labels in the world.”
“This could not be more well deserved”
Kovac (pictured) “has been an entrepreneur, pioneer and innovator in music all his life”, says AIM, working first as a promoter, then a manager and finally establishing a record label, publishing company, management company and strategic music marketing/research company.
Hs other achievements include pushing for Meat Loaf’s ‘I’d Do Anything For Love’ to be one of the first songs on the internet; hosting, with Duran Duran, what is believed to be the first music press conference online; supporting Spotify and music streaming in its early days, and encouraging the business away from one-time album sales; and producing The Dirt, the Netflix movie based on the Mötley Crüe book.
“Allen has innovated and tested the limits of marketing, social media, ticketing, streaming and sales reporting, which must make him feel as old as I am,” continued Branson. “He has worked towards benefitting the independent community and levelling the playing field between independents and the majors, as well as encouraging the fair valuation of music by tech giants. Whether it was Steve Jobs with the iPod and iTunes, Daniel Ek with Spotify or Amazon with smart speakers and in-car technology with Alexa, Allen has been ahead of the curve, collaborating, consulting and promoting new tech to the industry…”
“His next major project, with Nikki Sixx, is the Heroin Diaries musical,” Branson’s message concluded. “I hope that the Heroin Diaries will destigmatise addiction and do for the opioid crisis what Rent did for HIV and aids. I would like you all to join with me in congratulating Allen Kovac for his AIM innovator award. This could not be more well deserved.”
Kovac joins previous innovator award winners including artist Sophie and grime label/collective Boy Better Know. The AIM Independent Music Awards were established by the Association of Independent Music (AIM), a trade body for independent record labels, in 2011.
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PledgeMusic demise prompts industry support for artists
A group of industry organisations has launched an impact assessment survey to determine the severity and breadth of financial damage to artists affected by the demise of crowdfunding platform PledgeMusic.
Reports have circulated for close to a year that PledgeMusic was failing to pay artists who raised funds through its platform. Following the platform’s collapse, many artists remain deeply out of pocket.
The UK’s Musicians’ Union is hosting the survey, which closes on Tuesday 25 June, and is to be completed by individuals and businesses alike.
The survey is promoted collaboratively by UK Music, who last month called on competition watchdogs to investigate the beleaguered PledgeMusic, Music Managers’ Forum (MMF), the Association of Independent Musicians (AIM), PRS Foundation and International Showcase Fund partners including the Music Producers Guild (MPG) and Music Support.
The group hopes that information provided through the survey will illuminate the scale of the fallout from PledgeMusic’s collapse and help the industry to ensure artists and businesses receive the support they require.
In a joint statement, the industry bodies behind the survey wrote:
“As organisations who want to see the music industry thrive, we are deeply disappointed that PledgeMusic has announced its bankruptcy leaving artists and fans out of pocket and with little communication or advice on how to deal with campaign disruption.
“We are deeply disappointed that PledgeMusic has announced its bankruptcy leaving artists and fans out of pocket and with little communication or advice on how to deal with campaign disruption”
“The failure of PledgeMusic to appropriately ring-fence artist and fan money has the potential to damage artists’ careers and their relationships with fans and fellow creators if they can’t deliver on stalled campaigns.
“Individually, each of our organisations has been working hard to support our members during this difficult time. However, in order to consider collective action we have launched an industry-wide survey to assess the impact of the PledgeMusic closure.”
The survey has received artist support from UK band Jesus Jones, who used PledgeMusic to fund the release of their album Voyages, and has spearheaded the artists community’s reaction to the platform’s collapse.
“It’s really gratifying to see a strong industry-wide response taking place,” comment the band.
“As artists, as fans, as people who’ve come to realise the potential strength of crowdfunding, it’s vital that we all stand together, and rebuild confidence – and also seek to ensure that Pledge are held accountable for betraying such a vital bond of trust.”
After a decade, AIF goes it alone
The Association of Independent Festivals (AIF) will break away from its parent company, the Association of Independent Music (AIM), to operate as a separate company as of April this year.
AIF was set up in 2008 as a division of AIM by Rob da Bank (Bestival), Ben Turner (Graphite Media) and former AIM chief exec Alison Wenham, and has since grown from 12 to 65 member festivals with a collective audience of over 600,000.
The newly independent association will be led by current general manager Paul Reed, who has been appointed chief executive.
He will be supported by AIF chair Jim Mawdsley, vice-chair Goc O’Callaghan (ArcTanGent) and a board of directors that includes execs from Broadwick Live, Kilimanjaro Live, Standon Calling, Liverpool Sound City, Bestival and more.
“It feels like AIF has grown up and is ready to leave home”
Reed is also joined by new recruit Phoebe Rodwell, who moves from the Music Managers Forum to become AIF’s membership and project coordinator, a newly created role that will focus on membership development.
The company will also move into new premises at the Handbag Factory in Vauxhall, London.
“Following ten successful years, it feels like AIF has grown up and is ready to leave home,” comments Reed. “I’d like to thank all at AIM for supporting and nurturing AIF, enabling us to grow from a handful of promoters around a table to an invaluable support network for our 65 members.
“I’m incredibly excited about the future. We’re working on a number of initiatives and campaigns for this year and, with a new team in place, we’re in a strong position to move on to the next phase of our development.”
Arena Group to float on London Stock Exchange
Event infrastructure supplier Arena Group has announced plans for a stock market launch.
The multinational company, which supplies temporary structures, seating and project management services to large-scale live events, will list its shares on the London Stock Exchange (LSE) and hopes to raise approximately £60 million to grow its business.
Arena Group’s live-entertainment clients include Lollapalooza in Chicago, the Jockey Club (whose Jockey Club Live divisions promotes shows at racecourses around the UK) and BFI, for which the company last year designed a pop-up cinema venue. It in April acquired Wernick Group’s seating division, rebranding it Arena Seating.
“I am delighted to announce that our plans to apply for admission to AIM [LSE’s Alternative Investment Market] are moving ahead, as it marks a key milestone in the development of the group. We believe the listing will not only raise our international profile but will also enable us to provide additional incentives, by way of a share option scheme, for our senior executive team around our global operations.
“We look forward with confidence to this next stage in Arena Group’s development”
“The new funding leaves us with a significantly stronger balance sheet and provides us with the necessary funding, as well as access to further capital, to will help us to continue to grow the business both organically and by way of potential acquisitions.
“We are very fortunate to have a loyal and dedicated workforce of 750 employees across our 14 international bases, and the successful floatation of the group is a testament to their hard work and support going back many years.
“We look forward with confidence to this next stage in Arena Group’s development.”
Diversity in live music debated at AIM event
A host of women working in the live music industry offered some sage career advice and shared experiences during the Association of Independent Music’s Women in Music event last night.
Taking place at London’s City Hall, speakers included London night czar Amy Lamé (pictured), chief exec of PRS for Music Foundation Vanessa Reed, MD of End of the Road Festival Lauren Down, Sigma and Zara Larsson tour manager Sarah-Anne Grill, Kilimanjaro Live marketing manager Karma Bertelsen and Kelly Bennaton, Marketing & PR at DHP Family.
AIM’s annual discussion is timely this year, arriving shortly after a UK Music diversity study that revealed while women make up 60% of internship positions and 59% of entry-level business roles in the wider music industry, those in senior executive positions are just 30% female.
“We need to change the conversation about women in the music industry. The lack of diversity [in UK Music’s study] is self-perpetuating, as those in senior positions tend to promote people who are similar to them. If we don’t change the conversation and the culture, there are major opportunities we will miss out on.”
Lamé, who was appointed London’s first night czar in November to champion and protect the city’s nightlife, is also co-founder and host of queer night Duckie at the Royal Vauxhall tavern. She opened the evening with a keynote speech, saying: “We need to change the conversation about women in the music industry. As women, we face enormous hurdles.
“The music industry requires many skills, backgrounds and specialisms, but it’s a very challenging sector to develop into. Low-level positions are poorly paid, formal education is expensive and the cost of bringing a product to market is prohibitive. The lack of diversity [in UK Music’s study] is self-perpetuating, as those in senior positions tend to promote people who are similar to them – mostly white men – what a surprise.
“If we don’t change the conversation and the culture there are major opportunities we will miss out on. We need to welcome people and ideas into London 24/7, and redeem and nourish entrepreneurial and creative spirit. Let’s put music and women at the very heart of London as a vibrant 24-hour city. Let’s be brave, let’s be bold and let’s do it together.”
When asked how to improve gender balance in the traditionally male-heavy live music industry, panellists suggested challenging perceptions, championing fellow women, and finding leaders who make efforts to shift culture. “I face ridicule every day I do a show,” said Grill, who also works as a production manager. “Yesterday I was doing a show and a stage manager refused to shake my hand. So I have to rise above, think more about what I say, which I always have to say twice, and give other women a lending hand.”
Bennaton pointed to positive discrimination as a necessary short-term measure, which Reed preferred to call ‘positive action’. “Discrimination sounds like it’s not deserved,” she explained. “It’s about recognising talent in places you don’t normally recognise it.”
Bertelsen said her current boss, Kilimanjaro CEO Stuart Galbraith, is able to shift the mind-set of the men she works with who assume she’s in a junior role by championing her work. “He’s been very supportive,” she explained. “He’s never made me feel any different for being a woman, he asks me for my opinion and tells me I’ve done a good job. If there are other men we are dealing with, he makes sure that if I’ve put a point forward that makes sense I’m given the right recognition for it. He sets the record straight, ‘This is the marketing manager and you listen to what she says.’”
“If you are not booking women [on festival bills] you are being lazy. It’s not hard; there are so many amazing musicians out there. How can you have less than 5% [female acts]? What are you being paid to do? Our line-up for End of the Road this year is currently 53% women and I’m not even thinking about it.”
Moving on to the subject of festival bills, the panellists agreed that bookers must do more to ensure they have a 50/50 male/female split. Said Down: “If you are not booking women you are being lazy. It’s not hard; there are so many amazing musicians out there. How can you have less than 5% [female acts]? What are you being paid to do? Our line-up for End of the Road this year is currently 53% women and I’m not even thinking about it.”
Grill puts on Fieldview Festival with five friends and said the key to a diverse booking is teaming up with people who are equally passionate but with different tastes. “If it’s one person making the decisions you get a fairly straight line-up. If you’ve got an exchange and dialogue with people that don’t like the same thing you do, you’ll end up with something diverse.”
There’s been a number of reports of sexual assault cases at festivals over the last few years and in 2015, the Girls Against campaign launched to raise awareness of and ultimately end sexual harassment at gigs and concerts. Bertelsen said Kilimanjaro pass on descriptions of males involved to venues in order to try and avoid repeat incidents. Down proposed festivals have a safe welfare space that is looked after by well-trained people, near the medics, and with a line to the police for victims to go to and talk.
“Anonymity is a groper’s best friend,” she said. “What annoys me sometimes is the pressure is only on women to prevent the assault, but it’s about education which starts at home, in schools, and it’s about bystanders as well. It’s everybody’s responsibility to keep everyone safe, if you create a friendly atmosphere at your festival, make friends with those camping next to you, that builds the foundation for a really good experience.”
Bennaton said security should be trained by specialist services and pointed to the work done by the White Ribbon Campaign – a global effort run by men to end male violence against women. Its Safe Music Report, with practical tips for festivals and venues to keep women safe and encourage men to be part of the solution, is available here. Bennaton continued: “The onus shouldn’t be on victim to come forward about abuse, we need to keep an active eye on it. We need more pro-action.”
The key to getting more women into top-level positions is a revision of 24/7 work culture, said Down, while Reed raised the example of a band applying for funding from PRS Foundation to support maternity leave. “That’s the first time we’ve ever had an application for that purpose. There are lots of practical things like that we could all be thinking about more,” she added.
Bertelsen concluded: “Think about the little things you can do to challenge the status quo and question things. I recently noticed that all radio and TV advertising I was doing offered only male voiceover artists, so I’ve asked for our ad agency and all the radio stations to use female voiceovers too. Then, be true to yourself, do what your gut feeling says and try to encourage people to change their thinking.”
Time Out buys Yplan for £1.6m
Last-minute event discovery and ticket sales platform YPlan has been acquired by the Time Out Group in a £1.6m all-stock deal.
UK-based Leanworks – trading as YPlan – has raised more than £31 million since its founding in 2012 by Lithuanians Rytis Vitkauskas and Viktoras Jucikas, who say in a joint statement the company is an “excellent fit” for Time Out.
Yplan lost £6.2m in 2015, although Time Out notes that “subsequent reductions in its cost base have materially reduced losses in the current year” and so expects the acquisition have only a “mildly dilutive” effect on its turnover this year.
“[Buying Yplan] will enable us to offer our large audience more online booking opportunities while improving the user experience”
Time Out, which has been listed on the London Stock Exchange’s AIM market since June, operates in 108 cities worldwide and offers recommendations for food, attractions, art, culture, shopping and nightlife. Its CEO, Julio Bruno, says: “Developing ecommerce and monetising our audience is an important element of our ambitious growth strategy. We acquired YPlan because its advanced technology will significantly accelerate this strategy. It will enable us to offer our large audience more online booking opportunities while improving the user experience.
“We look forward to welcoming the highly skilled YPlan employees to the Time Out team. Together we will be stronger than ever to bring our customers the capabilities to make the most of the city and to make Time Out an even better place to discover, book and share.”