📑 CMU Digest: Dynamic ticket pricing in the sp otlight plus $10 million streaming scam exposed

CMU Digest is our weekly round-up of the most interesting music business news stories from the last seven days.

This week: Dynamic ticket pricing was in the spotlight last week after a backlash to the sale of tickets for the big Oasis reunion shows - so much so the UK government has added dynamic pricing to a consultation on ticketing and the Competition & Markets Authority has launched an investigation. US prosecutors have charged a man over an alleged $10 million streaming fraud scam. The copyright squabble between the Isaac Hayes estate and Donald Trump continues. The UK live sector is growing but still needs more government support. And The 1975 have responded to the lawsuit filed by the promoter of the Malaysian festival where they caused a controversy in 2023.

ICMYI: Barry Manilow sues Hipgnosis; Warner gets itself removed from sex abuse lawsuit filed against late Atlantic Records founder Ahmet Ertegun; musician sues Billy Joel over 1979 recording session; more corporate dramas in the world of K-pop; law-makers consider more AI regulation; Spotify seeks dismissal of MLC lawsuit.

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Dynamic pricing in the spotlight following Oasis ticketing outrage

There was lots of criticism of the way ticket sales for the much hyped Oasis reunion shows were managed, partly because ticketing platforms struggled with the huge demand, but also because dynamic pricing was employed by Ticketmaster. With dynamic pricing, prices go up and down depending on demand, meaning prices for the Oasis shows ended up being significantly higher than most fans expected. The band ultimately responded, insisting they were not involved in the decision to apply dynamic pricing, passing the blame onto their promoters and management.

There have been controversies around dynamic pricing in ticketing before, but not on this level in the UK. The government immediately announced it would add dynamic pricing to the agenda of an already planned consultation on the ticketing market. And both the Advertising Standards Authority and the Competition & Markets Authority announced they were reviewing complaints about the way Oasis ticket sales had been managed and communicated, with the CMA ultimately launching a formal investigation. Meanwhile, with dynamic pricing in ticketing in the news, it also emerged that the European Union is reviewing the practice.

US prosecutors charged a man in connection with a $10 million streaming scam

It is alleged that Michael Smith operated a sophisticated streaming fraud operation that involved “billions” of fraudulent streams of “hundreds of thousands” of AI-generated tracks to generate more than $10 million in royalties. According to an FBI investigation, Smith set up thousands of accounts on streaming platforms, working with other people in the US and abroad to try to make those accounts look genuine. He then worked with a music AI company to generate hundreds of thousands of tracks and set those accounts playing them.

Because of the way streaming works, he pulled significantly more out in royalties than he put in through subscription fees. While the music industry has pursued civil litigation against the providers of stream manipulation services, there have been relatively few criminal cases tackling streaming fraud, the most notable one to date being in Denmark. Smith faces charges of wire fraud conspiracy, wire fraud and money laundering conspiracy.

Donald Trump was told to stop using Isaac Hayes’ songs at his rallies

The Isaac Hayes estate has sued the Donald Trump election campaign and various entities that have organised Trump speeches, including the Republican National Committee, accusing them of copyright infringement for playing ‘Hold On, I’m Coming’, co-written by Hayes, at their events without licence. The estate also asked for a preliminary injunction specifically banning use of the song at future Trump events, which was granted last week.

As expected, both the Trump campaign and the RNC have claimed in court filings that their use of the song at past events was covered by a licence from collecting society BMI. The Hayes estate has now excluded ‘Hold On, I’m Coming’ from BMI’s political entities licence, but that only happened last month. However, responding to those court filings on X, Hayes’s son said that the song’s co-writer David Porter actually excluded the song in June, so the BMI licence did not apply after that point, including during the Republican National Convention in July.

UK live sector called for more government support, but EU changes unlikely

Trade group LIVE published new data showing that the live music sector provided a £6 billion boost to the UK economy last year. That was a 17% increase despite, as Chair Steve Lamacq pointed out, the industry facing “a spike in costs as a result of inflation, the cost-of-living crisis and labour shortages”. However, LIVE added, the grassroots live sector faces huge challenges and requires more government support, including via the much called for cut in VAT on tickets.

Another way the UK government could help the live music community is by working with the EU to remove some of the bureaucratic barriers that artists and their crews now face when touring Europe post-Brexit. There was optimism the new government might have more success than the last one in that domain, not least because the Labour Party identified “helping our touring artists” as a key priority in EU talks in its election manifesto. However, papers seen by the FT say that EU officials have already ruled out the kind of changes that would be required.

The 1975 responded to the Good Vibes lawsuit

The band were sued in July by the promoter of Malaysia’s Good Vibes festival, Future Sound Asia, after frontman Matty Healy spoke out about the country’s anti-LGBTQ+ laws during a performance at the 2023 edition, resulting in the local authorities shutting down the rest of the event. Future Sound said that the band knew about and agreed to follow strict rules governing performances by foreign artists in Malaysia, and should therefore be liable for the shutdown of the festival resulting from them breaking those rules.

In their response, The 1975 said that the rules cited by Future Sound were actually guidelines used by a government agency that grants approval for foreign artists playing in Malaysia, and those guidelines “do not impose any obligation on foreign artistes that is capable of being enforced against such foreign artistes”. Therefore it was not foreseeable, for the band at least, that Healy’s on-stage comments would result in the festival being shutdown.