Foreword 

At CAST, we aim to contribute to productive, generative conversations. Conversations that don't pick sides but rather frame discussions in a way that can help understand the past to better create the future.

Our interest in the entertainment industry is in discovering a better model for the future. One that is led by a stronger connection to technology so that the future can be built together.

If we haven't got this right with anything we write, please let us know. We are here for meaningful two sided discussions.

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Independent Music Creates the Culture. Who Should Capture the Value?

Is the music industry deciding that the current state of the industry is the way it would like the industry to continue?

At every major transition point, there's a window where choices get made, infrastructure gets built, and the decisions that follow lock in a version of the future.

We're in one of those windows right now. And the question of whether the industry is making an active choice, or continuing on the path it already knows.

If there's a part of the industry that think things should be different, this is the moment to have that discussion. It's not about knowing, but it's about being open to a conversation around what it could look like.

Top 100 Artists on Spotify

55 started as Independent contributing 56% of total streaming numbers across top 100

34 Major from start contributing 34% of total streaming numbers across top 100

(8 Legacy artists)

****The majors do invest heavily in A&R, that capital is real and the infrastructure it buys is significant. The data simply raises the question of whether that investment is arriving earlier in an artist's career, or later, once the independent sector has already done the work of proving the audience exists.***

The Number is Currently 80%, Does That Fit with the Value Independent Artists Create?

We know that Universal, Sony and Warner control roughly 80% of the recorded music industry.

Over the last 18 months, the majors sued the leading AI music platforms, Suno and Udio, for copyright infringement. They then went onto settle these suits and announced partnership deals.

The deals are progress toward a future but the question sitting alongside these decisions is where does this put the industry in 10 years' time? Is that a future that the industry is happy with?

The AI Moment: Shaping the Industry for the Next 10 Years

The majors hold the catalogues that AI companies need to build convincing generative music tools.

***It's not that independents don't have the number of tracks to create models but the model companies see it as to difficult to do the number of deals that would be required***

The European Composer and Songwriter Alliance has raised concern that the terms being agreed, on behalf of artists and songwriters, lack transparency. The revenue-sharing structures emerging from these negotiations may follow the pattern set during the early streaming era, where the terms locked in early shaped the industry until this point.

Whether this transition point is also an opportunity to examine the structures that distributes 80% of industry value to the majors, or a moment to reinforce them, is a question only the industry can answer.

Is the Question Worth Asking?

So back to where we started.

Is the music industry actively deciding that the current state of the industry is the way it would like the industry to continue? If yes, the technology platforms being built right now should be designed to serve that.

If there's a part of the industry that sees this moment differently, that wants to consider how the independent sector participates in the next chapter more meaningfully, the time to raise that is now. Not after the AI licensing framework is established. Not after the deals are done. Now, while the architecture is still being drawn.

The decisions made at the start of a new infrastructure cycle tend to define the cycle. The streaming era is evidence of that.

We're at the start of another one.

Summarised

Is the music industry consciously choosing to carry its current structure into the AI era? That's the question at the centre of the moment. Three companies hold roughly 80% of recorded music revenues. Independent artists collectively see less than 10%. The AI licensing deals being struck now will set the economic infrastructure for the next chapter of the industry. Whether that infrastructure looks like the one we have, or something that looks different, is a choice the industry is making right now, actively or by default.