London and Brussels 10 June 2025

A new report “Combating the Emergence of a Two-Tier Music Streaming Market” has been published today. Analysing recent evolutions in the music streaming market, the report warns that a two-tier industry is emerging which requires “immediate attention”.

The analysis has been carried out by industry experts Dan Fowler and Katherine Bassett and is addressed to all actors in the music sector including digital services, with several of the recommendations aimed at decision makers. 

The authors note that their report “…identifies a widening gulf between large rightsholders and independent actors, driven by market consolidation, opaque platform policies, and emerging monetisation practices that increasingly favour scale over diversity; the emergence of a two-tier industry”.

As well as evaluating how a two-tier market has evolved, the authors benchmark the current state of the music streaming market against IMPALA’s streaming plan as a set of KPIs for the industry. 

The report cites “five critical areas for immediate attention”: 

• Combatting AI dilution and streaming fraud through cross-industry collaboration and regulation. 
• Reforming royalty distribution models to ensure fair access for all market participants and increasing subscription fees in line with inflation. 
• Enhancing transparency in DSP practices, especially concerning play-boosting tools and content de-monetisation. 
• Restricting and reversing market consolidation to maintain competitive diversity. 
• Embedding consultation and impact assessment into any future industry changes to avoid unintended harm. 

Dan Fowler, industry expert and co-author of “Combating the Emergence of a Two-Tier Music Streaming Market” commented: “At a time when cultural homogenisation is on the rise, where generative AI is increasingly putting innovative creativity in competition with mass derivation, we risk a future where music diversity is also being actively commercially suppressed.” 

Dario Draštata, Chair of IMPALA, President of regional association RUNDA Adria and Executive Director of Dallas Records commented: “I welcome this report as a reflection of where we are in the digital market right now. The principle of de-monetisation is fundamentally and legally wrong. Concentration is a factor undermining the evolution of the market and must be addressed along with subscription fees, oversupply and dilution from AI and fraud.”

Gee Davy, CEO of AIM, Association of Independent Music, added: “Much of the independent sector will come together this week at indie week in New York and this report brings essential insights for us all.  The damaging effects of streaming thresholds and de-monetisation of many artists are laid bare. Streaming, for all of its promise of democratisation is in some cases delivering the opposite – taking income from those who need it most and redistributing it to the elite.  Oversupply, dilution and fraud must be addressed but not at the expense of our emerging, diverse and niche music.”

Mark Kitcatt, Owner of Everlasting Records and Popstock Distribuciones, continued: “When we adopted IMPALA’s first streaming plan, we did not anticipate that experts would see it as a set of KPIs, but it makes sense. A two-tier streaming market undermines diversity and devalues creative labour.”

Helen Smith, Executive Chair of IMPALA, concluded: “The question of market power comes out very clearly in this report as an underlying cause of many of the issues we see in the streaming market. We agree with the recommendation that further concentration should be restricted and even reversed.”