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MMF Chief Annabella Coldrick Talks Labels’ Streaming Equity, Why a Lack of Transparency Is Causing Mistrust

Annabella Coldrick, who leads Music Managers Forum, the UK-based representative body of artist managers, speaks with Billboard about transforming the streaming business for the better.

Warner Music Group CEO Stephen Cooper told investors during a Feb. 4 earnings call that — in the event that the company receives cash proceeds from selling its equity stakes in streaming services — it will share the revenue with its artists. Just hours later Sony Music made the same pledge. That led to U.K. organization the Music Managers Forum (MMF) to call for Universal to do the same.

“We will continue to have a dialogue with them and urge them to follow suit, but there hasn’t been a response so far,” MMF’s Chief Executive Annabella Coldrick tells Billboard in a Q&A about the industry practice of NDAs, artist leverage and transforming the streaming business for the better. (Universal didn’t respond to requests for comment, though a company spokesperson told Billboard on Feb. 11 that the label group is in a quiet period ahead of parent company Vivendi’s full-year earnings report, which were released last Thursday.)


Billboard: How significant is the announcement by Warner and Sony that they will share cash proceeds from equity stakes with artists?

Coldrick: It’s a significant step forward, but Universal now need to follow and all the majors need to do more in terms of transparency. Our main issue is not record labels taking shares in streaming services. But that equity is being traded for access to artists’ catalogs as part of an overall deal which includes price-per-stream, equity stakes and revenue share. Artists should see a return from that if and when that equity is cashed in, and there are still a lot of questions about how exactly that money will be shared. Will it only go to artists that are contracted to the label at the time when the shares are sold? How will it be distributed among the roster? There are many questions remaining and it all comes back to a lack of transparency.  

Warner Music Group CEO: ‘We Will Share’ With Artists Any Proceeds from Sale of Our Stake in a Streaming Service

Without knowing exactly what the terms were at the time licensing deals were struck with streaming services, isn’t the promise to share equity something of an empty gesture?

That is one of our concerns. We’re pleased that in principle they have agreed to share because it sets a precedent. But it’s not in itself enough. We need to be able to see the terms of the deals that streaming services negotiated. What trade-offs were included? What were the kick-backs? We’re not asking for confidentiality to be breached. But if you’re trading in artists’ catalog we want to see the terms in which those works are being traded. We’re unable to do that at that moment. Everything has to be taken on trust and it’s hard to have trust when you don’t have any of the details. 

With all the different models of distribution and access that are available now, do artists have more leverage to strike better deals?

Possibly some of the larger ones are in a stronger position. For new artists it’s still very difficult, and their ability to negotiate is a lot more constrained. Today, there is a far greater onus on artists to build up their careers to a high level from an early stage than there ever was before. 

What impact do you feel the practice of labels licensing artists’ catalogs in return for equity stakes — all protected by NDAs — has had on the industry?

To some extent it’s damaged trust in streaming as a model. It’s one of the reasons why you see artists saying that they are not making any money from streaming — because they are unable to see where the flow of money goes. At MMF we do think streaming is both the present and the future. But that lack of transparency does lead to a lack of trust and it’s important that the industry helps rebuild that. 

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What changes would you like to see made to the digital music economy?

We’d like to see wider consideration about how streaming is remunerated. At the moment, it’s treated as a sale by the labels with the same royalty pay-out as a physical sale or digital download. Streaming in our view is not a sale. We would like to see it being treated as something closer to a radio broadcast where it’s subject to equitable remuneration and where a percentage of the money goes direct to the artist, regardless of whether they recouped their account with a label. At present, if artists are un-recouped they will never see a penny of that [streaming] money, even though the label is not investing or incurring further costs. Equitable remuneration is a fundamental way that business could be addressed that would transform the way that artists see streaming. 

Kobalt and BMG have made transparency key tenants of their business model. Can record labels learn anything from the publishing world? 

Kobalt has certainly been a great disrupter in setting standards around transparency. Indie labels have also made great strides forward with the WIN ‘Fair Digital Deals Declaration.’ But the majors have always operated in a way where they haven’t had to be transparent and for some of them it’s probably quite a big cultural step forward. However, it’s absolutely critical that they do so. We’re calling for all the majors to show greater transparency in all of their deals to do with artists’ catalogs. It’s vital for the future health of the industry.

Following Taylor Swift’s successful protest against Apple Music last year, do artists also have a responsibility to become more vocal in standing up for the rights of performers, songwriters and rights holders?

I think so. At the same time we need to be encouraging artists not to be turning away from new technology.  Our aim is to get the industry to sit up and listen and understand that there is an issue here with trust and it needs to be addressed.