Brexit music: British biz looks at a future away from the EU

As the two-year process of uncoupling from the European Union is expected to lead to economic and social uncertainty, the British music industry is both nervous and positive about the future.

There are already repercussions due to the fall of the British pound in the wake of the Brexit vote.

For instance, the price of iTunes downloads, which are pegged to the US dollar, are up an estimated 25%. Musical equipment by US brands such as Gibson and Fender have also risen.

The creative industries are of huge importance to Britain’s economy – the music industry alone contributes £3.8 billion (A$6.24 billion) – and the value of their exports to the EU is £19.8 billion ($32.6 billion). Not all their products are covered by WTO rules.

There are potentially huge impacts from changes to freedom of movement, loss of investment and funding and less access to markets. 6.1% of the British creative force are EU (non-British) nationals.

The fierce governmental discussions with the 28 EU member states – including major music markets France, Germany, Spain, the Netherlands and Sweden – will cover trade relations, immigration and border access.

The music industry is divided on the impact of Brexit. Alison Wenham, CEO and Chairwoman of the Worldwide Independent Network, opines it will not damage the current huge global success of British music, led by Adele and Ed Sheeran.

“Brexit (is) unlikely to reduce demand for our artists across the world,” she insists. “With the creative industries driving strong growth in the U.K. we are confident that we can maintain our enviable international position, with our government acutely aware of our cultural and economic value.’

Jo Dipple, CEO of UK Music, says that due to the prominence of British music and other creative fields, the Government should “listen to the creative sector when it talks of the opportunities and challenges ahead”.

“Navigating towards our EU exit in April 2019 will be hard and the Government must use its strongest hand to steer.

“Leaving the EU can’t make our music any less good. It might, though, make the framework for its success a lot stronger.

“Getting the post EU-framework right for music means more jobs, more young people in apprenticeships, bigger export strength, more diplomatic power and more tax revenue flowing in from every city, nation and region.

“Getting it wrong probably means a return to punk rock.”

Some in the music industry believes that the Government should strengthen copyright laws during its talks.

British songwriters are protected in that societies as PRS For Music are part of a strong worldwide network of music collection bodies with reciprocal deals ensuring their royalties will get paid across national borders.

Nevertheless, the Paris-based CISAC (International Confederation of Societies of Authors and Composers) and Brussels-based GESAC (The European Grouping of Societies of Authors and Composers) have warned Brit songwriters and composers to ensure that copyright remains on top of the British Government’s agenda.

For the live music industry, the fear is whether Brit acts can continue to work across EU borders without visa restrictions.

Young emerging acts on indie labels in particular, already on small budgets while they break into wider markets, would be hardest hit if they have to pay more for separate visas and insurance or be taxed to transporting gear and merchandise.

The temporary document they need, a carnet, would cost between £1000 ($1647) and £2000 ($3295) for 12 months.

The positive is that with the state of the pound, more British and EU acts would prefer to work in British studios, and there’d be a boost for British music festivals.

As long as there are no restrictions on EU residents entering Britain, music tourism could also get a boost.

According to UK Music’s Wish You Were Here 2016 study, music tourism is worth £38 million ($62.6 million). 38% of audiences at UK festivals are from outside the country and 767,000 travelled from overseas to attend live music events.

Not all of them are from the EU but any restriction on their movements could have a severe impact on these figures.