The Brexit’s Impact On The Global Music Economy
The surprise Brexit vote is guaranteed to have far-reaching economic effects in a variety of areas, and the music industry is by no means immune. Here we examine some of the ways those operating in the music business can expect to feel the Brexit's impact.
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Guest Post by Dre Dimura on Soundfly's Flypaper
With the aftershocks of the United Kingdom’s vote to exit the European Union still being felt around the world, it is unclear how Britain’s historic “Leave” vote will affect the global economy, trade, and immigration. In addition to political and social issues, there may also be far reaching implications for musicians in the UK, EU, and around the world. Here is how Brexit could affect the global music industry…
In Case You Missed It
In an historic move last week, UK voters passed the “Brexit,” voting to leave the European Union by a 3.8% margin, which has triggered a chain reaction of economic, social, and political confusion and chaos. Global markets plummeted by $2.08 trillion overnight, and British Prime Minister David Cameron, who won re-election last year, swiftly announced his resignation following the results. Cameron, a staunch Remain supporter, introduced the referendum as part of his bid for re-election in 2015, to appease Eurosceptic conservative voters.
The Remain movement has been statistically strong among people working in the arts and boasts the overwhelming public support of actors and musicians. Let’s take a look at why this is the case and examine some possible implications of Brexit for performers, their fans, and their livelihoods.
Visas
Tour managers, prepare for paperwork! While its unclear how the new arrangement will impact travel, more borders generally mean more headaches for touring musicians.
For artists from outside of Europe looking to perform in both the UK and EU, this news likely means two of everything — two sets of immigration lines, two visa applications, two sets of fees, and two opportunities for those applications to be delayed or denied. For US artists on a quick tour not expecting to earn any money, this might not be a huge deal. Foreign nationals from many high-income countries — including the US, Australia, and Canada — can already enter and exit both the UK and the EU as visitors without a visa. But for artists who are expecting to earn money, which requires temporary work visas, as well as artists from countries for which the EU and UK require visitor visas, these changes may seriously complicate plans, and make back-to-back bookings in the UK and EU too risky to be worth the effort.
For UK and EU-based artists, who are used to easily hopping between European countries to play shows, those sorts of frequent and casual bookings will likely become more complicated, though a lot depends on the next few months of negotiations.
Similarly, artists who tour with crews of mixed UK and EU workers may experience difficulty with visas.
The takeaway for fans is that we will likely see international artists, especially mid-level artists, choosing to tour either Europe or the UK, so as not to have to deal with logistical risks in the middle of a fully-booked calendar. The imposition of work regulations across the EU/UK border will likely mean a sharp drop in UK bands casually booking one-off shows or short tours on the continent, and vice versa. Longer-term artistic exchanges, such as residencies, will undoubtedly also be impacted by new rules around immigration and work visas.
With touring in America already a major hurdle for many British bands, we could see a similar trend emerge for those bands looking to tour on the continent. Rules under the Schengen Agreement require proof of funds for travelers residing or in transit in the Schengen Coverage Area(26 European nations, not including the UK). This can pose detriment to artists touring on a tight budget. If promoters or agents have to double as sponsors we could see less risk being taken on up and coming talent.
Copyright
As a sovereign nation, Britain will most likely sacrifice most, if not all, of its sway in the European Commission’s ongoing effort to modernize the EU’s copyright laws. These laws have a considerable impact on copyrighted content flowing in and out of Britain, and lack of pan-copyright law between the UK and EU could create complications for artists seeking to protect and sell their work in foreign markets, such as lack of distribution in certain areas. We could see a decline in the number of British songs, movies, and television being broadcast in EU nations.
Arts Funding
The European Union’s endowments for the arts contribute to a large portion of annual funding for music, TV, film, and theater within the EU. The European Regional Development Fund (ERDC) works to incentivize production of film and TV in Europe. The most likely outcome here is simply that British creators will no longer have access to that funding. Productions such as HBO’s smash Game of Thrones have relied heavily on such funding in their developmental stages, and although showrunners, David Benioff and D.B. Weiss claim that the Brexit will have zero impact on the future of that show, forthcoming productions, especially small budget productions trying to get off the ground, may need to find new sources of capital.
Lost Income from Fans
Part of what makes the Euro music scene so diverse is the incredible cross pollination of artists and fans from a staggering array of countries and cultures. A study published by UK Music reveals that “music tourism” in the UK generated over £3.1 billion in 2014 alone, with 9.5 million music tourists attending events such as the Glastonbury, Isle of Wight, and T in the Park music festivals. Faced with a more complicated international border, we could see some decline in the number of EU fanswilling to make the trip each year.
Despite the meteoric rise of streaming services such as Spotify and Apple Music, physical music sales still account for a significant portion of the market, especially in Europe, with France and Germany alone accounting for over 50% of worldwide hard copy revenue. With the murky future of UK/EU trade deals, taxes, and tariffs, we could see a rise in the price of both producing and purchasing tangible media such as vinyl and boxed sets. Taxes could also present a disincentive for British fans to buy European albums and ship or bring them home (and vice versa).
Is There an Upside?
According to the Lisbon Treaty, the UK has two years negotiate their EU divorce, so at the moment we are still in unchartered territory. Amidst the conjecture, the only thing we know for a fact is that Brexit has created a tremendous deal of uncertainty amongst economists, politicians, and the general population, and that includes artists. In the long term, we don’t really know how the Brexit will affect the music — or any other — industry. Until then, we’ll have to forge through the growing pains of this unprecedented shift in the global political climate.
While musicians across Britain, from Lilly Allen to Mogwai, Disclosure to Max Richter, and hundreds more have been publicly bemoaning the Leave vote, Natasha Khan of Bat for Lashes had a darkly optimistic take on the crisis. In a public conversation on the Guardian’s website, she said she felt “devastated” by the message the vote sent, but that she hopes this break in the EU will help to “break down the things that aren’t working for us any more, and to bring about more emphasis on community, loving our neighbours, re-educating ourselves that we are all global citizens, and start to rebuild structures we’re facing in the future, like stopping wars that create the immigration crisis, environmental issues we’ve been ignoring for too long, and the fact we need to reach out to each other as a global human race.”
Anything’s possible, but in the meantime, get ready to start your visa applications!
If it wasn’t for the EU bands like the Beatles could never have spent their early days in Germany and then gone on to world wide success. Oh . wait a minute,the EU didn’t exist then! UK music did very well before the EU. Of all the obstacles that the UK music business has faced over the last 20 years, Brexit is pretty far down the list!