Government investigation into ‘collapse of PledgeMusic’ demanded by UK Music

Michael Dugher, the CEO of commercial music industry umbrella body UK Music, has called for a Government investigation into the “collapse” of D2C and e-commerce platform PledgeMusic.

In a letter addressed to Small Business and Consumer Minister Kelly Tolhurst, Dugher has demanded that the beleaguered direct to consumer platform be referred to the UK’s Competition and Markets Authority.

As reported yesterday, PledgeMusic is headed into administration after the UK-based company failed to find a buyer following a three month search.

Current estimates suggest that the company owes artists over $1m.

“Musicians should be able to trust crowdfunding platforms to fulfil their obligation of delivering money pledged by fans and supporters.”

Michael Dugher, UK Music

Pledge co-founder Benji Rogers confirmed that the firm was heading into administration in a blog post on Wednesday night (May 8).

Rogers recently returned on a voluntary basis to try help find a buyer, having officially left the company in 2016.

“I went back into PledgeMusic just over three months ago as a volunteer to try and help the board and team turn around and sell the company, but I am sad to report that this effort has not met with success and that PledgeMusic will shortly be heading into administration,” wrote Rogers.

Writing in the letter, UK Music’s Dugher said: “Emerging musicians often rely on crowdfunding platforms to raise capital to support album recording costs, music video costs and other capital expenditures.

This is often a crucial step for them to progress through the music talent pipeline.

“Musicians should be able to trust crowdfunding platforms to fulfil their obligation of delivering money pledged by fans and supporters.

“I would therefore ask that you refer PledgeMusic to the CMA to ensure this matter is properly investigated.”

You can read the letter in in full below:


Dear Kelly,

I am writing on behalf of UK Music to ask you to investigate the speculated collapse of PledgeMusic and concerns that it may enter administration and to refer the case to the Competition & Markets Authority (CMA).

UK Music is the umbrella body for the commercial music industry. We campaign and lobby for the collective interests of the music industry on behalf of artists, musicians, songwriters and composers, record labels, music publishers, studio producers, managers and music licensing organisations.

Many musicians across the UK relied on crowdfunding website PledgeMusic to deliver payments from patrons, to pay for album recordings and other costs. These artists were already enduring long delays in receiving payments.

As a consequence, creators who used PledgeMusic’s services are likely to lose money if it goes into administration without resolving its outstanding debts. The Musicians’ Union is working with its members to advise them.

Emerging musicians often rely on crowdfunding platforms to raise capital to support album recording costs, music video costs and other capital expenditures. This is often a crucial step for them to progress through the music talent pipeline. Musicians should be able to trust crowdfunding platforms to fulfil their obligation of delivering money pledged by fans and supporters.

I would therefore ask that you refer PledgeMusic to the CMA to ensure this matter is properly investigated.

Kind Regards,

Michael Dugher CEO, UK Music

 

 Music Business Worldwide

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