ALMOSt half a billion pounds (£497 million) was invested by UK record labels and music publishers in writing and producing new music, signing and developing artists and songwriters, and promoting records – according to figures for 2014 released today by leading music organisations, BPI and the Music Publishers Association (respectively representing major and independent record labels and British music publishers).
British record labels invested an impressive £178 million in A&R in 2014 – equivalent to a quarter (25.4 per cent) of their annual revenues – while a further £157.4 million supported label marketing and promotion (22.5 per cent of label revenues).
This combined label outlay of over £335 million means that last year just under half of record label revenues (47.9 per cent) went into signing, developing and marketing artists.
Such investment helps to break new artists and has helped build the international careers of award-nominated acts such as Sam Smith, Ed Sheeran, George Ezra, Alt J and Royal Blood.
The £178 million A&R figure represents a 19 per cent increase on the £149 million outlay in 2013, and is the highest level of Artist and Repertoire (A&R) investment as a proportion of revenues since records began in 1992.
A similar industry survey by the Music Publishers Association (MPA) reveals that its members invested £162 million in the careers of songwriters and composers last year.
As a result of such sustained investment, the UK music publishing sector generated revenues of over £400 million in 2014.
This means a total of £497 million was invested collectively by these two sectors in discovering, nurturing, developing and promoting music talent – helping to fuel a global boom in British music which, as evidenced by the recent UK Music report, Measuring Music, contributed a total of £4.1 billion to the UK economy in 2014.
New artist signings reach a five-year high in the UK: At such an exciting time for British music, major record labels have increased the number of artists being signed.
The number of new artist deals signed by Sony Music, Universal Music and Warner Music, according to the BPI topped 156 in 2014 – up 30 per cent on the 120 signed in 2013 and the highest annual total since 2009, when 164 new deals were signed.
Music publishers drive UK music exports: Meanwhile, music publishers can claim to be responsible for one quarter of the UK music industry’s £2.1bn exports in 2014, contributing £519 million of the sector’s total.
This is borne out by earlier MPA research that revealed British songwriters and composers contributed to more than one in three of Billboard’s Year End 100 US albums for 2014, including those by Taylor Swift, Eminem, Katy Perry and Kelly Clarkson – the third year in succession this threshold has been crossed.
Says a spokesperson: “R&D investment in British music outstrips other leading industries: The A&R investment by UK record labels, when taken as a percentage of their revenues (25.4 per cent in 2014), is significantly greater than the proportion of revenues spent by other leading industry sectors on their product research and development.
“As a comparator, the European Commission’s EU R&D Scorecard shows that Biotechnology (17.4 per cent), Software (14.8 per cent), Pharmaceuticals (13.2 per cent) and Automotive (5.4 per cent) industries all invested less as a proportion of their sales in Europe than the recorded music sector did in the UK.”
Commenting on the figures, Geoff Taylor, chief executive BPI and BRIT Awards, said: “It’s no fluke that 2014 was such an outstanding year for British music.
“These achievements do not come easily, however, and they reflect the huge A&R and marketing investment by labels as well as the significant risks they undertake in signing new artists – for every global superstar there are, sadly, other acts that aren’t quite able to break through.
“Such A&R investment is typically well ahead of the proportion of revenues that other leading industries such as the Biotech, Software and Automotive sectors spend on their R&D.
“Alongside the artists themselves, the passion and commitment labels show in unearthing, nurturing and developing the next wave of talent is one of the main reasons our music is the envy of the world right now.
“It demonstrates the vital role labels play in the music ecosystem in providing venture capital for new music.”
Jane Dyball, CEO, MPA Group of Companies, added: “These investment figures highlight why British music remains so successful on the global stage. Music publishers are at the heart of this success – supporting songwriters and composers at every stage of their career, whether that’s a would-be recording artist just starting out, an international superstar or a jobbing writer.
“Their investment takes many forms: offering advice, finding label deals, securing sync licenses and cover versions and, of course, ensuring that our creators are paid for use of their works.
“Importantly, these incredible figures also highlight that music publishers, like record labels, make a very substantial annual investment in A&R, further demonstrating the music industry’s colossal contribution to the financial and cultural wealth of the UK.”
ENDS
Enquiries
Lynne McDowell, Lynne McDowell PR pr@lynnemcdowell.co.uk 07763 619 709
Gennaro Castaldo, BPI gennaro.castaldo@bpi.co.uk 0207 803 1326 / 07801 194 139
Jen Hall, MPA jen.hall@mpagroup.com 0203 741 3808
Adam Webb, MPA awebb@mpaonline.org.uk 07947 062 360
Notes to editors:
Expenditure on A&R (Artists and Repertoire) represents the recorded music industry’s and music publisher’s research and development expenditure and its investment in the future. In the UK market, each year’s new label releases make up over half of album sales.
Artist advances are the most significant part of label A&R expenditure (averaging 50 per cent of the total in the last three years), representing amounts payable to artists typically on signature or delivery of master recordings.
Such advances in part represent income to the artist but they are also necessary to meet the many costs associated with creating new recordings.
Other A&R costs include recording and origination, video costs and tour support.
About the BPI
The BPI was formed in 1973 and is the representative voice of the UK recorded music business.
As a trade organisation, it promotes recorded music in the UK and worldwide and champion the rights and interests of a broad range of members, including hundreds of independent music labels and companies and the UK’s three major record company groups – Sony Music Entertainment UK, Universal Music UK and Warner Music UK.
In 2013, our members accounted for approximately 90 per cent of all recorded music purchased in the UK – the world’s fourth-llargest music market – while UK artists were responsible for one in every seven albums sold, world-wide.
About the MPA
The Music Publishers Association (MPA) is the trade association for music publishers in the UK, with over 260 members, representing around 4,000 catalogues, covering every genre of music.
These include all of the UK’s major music publishers as well as independent pop publishers, library music publishers and printed music publishers.
The MPA exists to:
* Safeguard and promote the interests of music publishers and the writers signed to them.
* Represent these interests to government, the music industry, the media and the public.
* Provide publishers with a forum, a collective voice and a wide range of benefits, services and training courses.
* Promote an understanding of the value of music and the importance of copyright.
* Provide information and guidance to members of the public.
www.mpaonline.org.uk
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