📑 CMU Digest: Be sold or be banne d says US Congress to TikTok + more

Every Sunday CMU sends a summary of five key music business stories from the past week.

This week: It's the BAN edition! The US wants to ban TikTok. The UK Labour Party wants to ban insane ticket prices. Slightly more tenuously: French regulators haven't said anything about banning a Warner x Believe deal - but might they? Probably not. The EU Parliament banned nothing, but passed the EU AI Act. A bunch of bands banned themselves from playing SXSW.

ICYMI: Another potential streaming levy to get Spotify's blood pressure rising; Lizzo got paid $5 million for not having COVID which meant she was ready willing and able to play a festival that didn't happen; Bad Bunny is showing his (perfectly justified) mean side with a fan who thinks he's the main character; Tidal is ditching high quality audio subscriptions because everyone should have high quality audio and Neil Young agrees; this Thursday is the vernal equinox, National Be Nice day, and intergalactic Tiramisu day. And if the IFPI weren't doing a big stats drop on the same day, we wouldn't have found that out.

And Finally! The Sugababes are single handedly responsible for popularising sugar and ruining a generation, and they are sorry. Jacob Rees-Mogg agrees, and that's never a good thing...

Prefer to read online? Click here to go to this week's digest.

🇺🇸 Proposals forcing a sale or ban of TikTok in the US were speedily passed by the US House Of Representatives

The proposed act would give TikTok's China-based owner ByteDance six months to sell the social media app or face a US-wide ban. It is the latest attempt by American lawmakers to ban TikTok based on concerns that the Chinese government has access to US user-data via ByteDance. The act was only introduced into the House last week, was unanimously passed by the relevant committee within days, and then voted through by the entire House on Wednesday.

But sources told Bloomberg that selling TikTok remains a last resort option for ByteDance. Although its attempts to encourage users to lobby their Representatives in Washington seemed to backfire, ByteDance will continue to fight the proposals in the US Senate and, if necessary, through the courts. It argues that the act violates free speech protections in the US Constitution, an argument that has been successful in blocking past attempts to ban TikTok in the US.

🎟️ The UK Labour Party said it would introduce a ticket touting price cap if it wins the next General Election

It would mean that ticket touts - or scalpers - would not be able to resell tickets for any more than 10% of face value. Although not an outright ban - which is what anti-touting campaign FanFair called for last year - it would have a significant impact on the secondary ticketing market. The policy commitment was welcomed by FanFair and music managers, though ticket resale platform Viagogo indicated it would fight against the introduction of any new touting laws.

Labour's commitment came as two people connected to a former ticket touting operation, TQ Tickets, were found guilty in Leeds Crown Court of fraudulent trading. The criminal case against Mark Woods and Lynda Chenery stemmed from an investigation by National Trading Standards which sought to enforce existing laws that regulate ticket resale.

🥊 Warner Music’s maybe-maybe-not bid for French indie giant Believe took a twist this week

When Warner formally announced its interest in Believe in a regulatory filing, the statement included a very quietly worded threat that, on the face of it, didn’t seem like a threat at all. It all hinges on the fact that Warner wants access to Believe’s books to make a proper bid for the company - but the consortium led by Believe founder and CEO Denis Ladegaillerie has sped up how quickly they plan their own takeover.

The increased speed at which that competing deal is now moving means Warner might miss out, so it threatened to call in the French regulators in an attempt to put the brakes on. The independent “Ad Hoc Committee” at Believe was having none of it, and called Warner’s bluff. In a bold move, Believe has called in the regulators itself, but has also said that it will still block access to the information Warner wants to see.

Whether the regulator approves the accelerated Ladegaillerie consortium bid, or says that Believe has to throw open the books to Warner, remains to be seen. There’s potentially at least one other obstacle, and that is whether the French regulators would approve the sale of a prestigious French company, and a significant employer in the French music industry, to Warner - which recently laid-off hundreds of staff.

There’s also a potential issue raised by Warner sharing a common parent - Access Industries - with French streaming platform Deezer. Would the French regulators view Warner, Believe and Deezer ending up as frérots as too much of a good thing?

🇪🇺 The European Parliament passed the EU AI Act

The EU AI Act has been voted into law by the European Parliament, and pretty much every trade body in the music industry joined together in a big group hug, putting out a statement saying that it’s a “world-first” before going back to their usual jostling.

The EU AI Act introduces wide-ranging regulation of artificial intelligence across the European Union. For the music industry - and the wider copyright industries - what matters most is what it says about the copyright and transparency obligations of generative AI companies. Any AI businesses operating in Europe will need to make available information about what data has been used to train their models and demonstrate that they have complied with EU copyright law, regardless of where any training or development actually occurs.

World first it might be, but the name could have been better thought through: try saying EU AI Act rapidly a few times, and you quickly end up sounding like you’re singing ‘Old MacDonald Had A Farm’. Anyway, the act, say the trade bodies, “provides tools for rightsholders to enforce their rights” which sounds great. Of course, quite how useful the new AI regulations prove to be for music companies will depend on how they are actually implemented. Watch this space.

🔫 Dozens of artists and bands boycotted South By South West because of its military sponsors

The US Army was a “super sponsor” of the Austin, Texas showcase festival this year, while there were defence companies involved in the conference. That proved particularly controversial because of those organisations' connections to the conflict in Gaza. One of the bands to pull out, Belfast-based Kneecap, said they wanted to "highlight the unacceptable deep links the festival has to weapons companies and the US military who at this very moment are enabling a genocide and famine against a trapped population".

Texas governor Greg Abbott told the boycotting bands "bye - don’t come back". However SXSW itself said it respected the decision made by the acts that had cancelled performances, but defended the involvement of the military and defence companies in the event. It said, “the Army’s sponsorship is part of our commitment to bring forward ideas that shape our world”, but added, "we fully respect the decision these artists made to exercise their right to free speech”.

🎙 Setlist Podcast: US politicians want TikTok to sell up or be banned

Each week CMU's Andy Malt and Chris Cooke take a look at the week in music - and the music business - with a recap of key stories and news.

In this week's Setlist Podcast: Chris Cooke and Andy Malt discuss proposals voted through the US House of Representatives this week to force TikTok owner ByteDance to sell the video-sharing app or face a ban in country, and the UK Labour Party's pledge to introduce a cap on ticket resale prices if it wins the next election. Click here to listen - or search for 'Setlist Podcast'