REPORT IFPI
THINGS YOU NEED TO KNOW ABOUT
The IFP I’s annual report on the state of the global music industry reveals a business in rude health. But what’s happening beneath the headline statistics? Music Week read the report (so you don’t have to) and came up with these essential nuggets of knowledge…
LABELS BY MARK SUTHERLAND
STREAMINGIS NOWA GLOBAL PHENOMENON The global value of streaming grew a massive 60.4% in 2016 as new services launched and the world caught on to the new way of consuming music. Most significantly – and in contrast to the UK market – the rate of growth accelerated, from 47.3% in 2015 and 36.2% in 2014. So, while North America and Europe’s streaming businesses still led the way, growing 84.1% and 45.5% respectively, there were also 45.6% rises in Asia and Australasia and a 57% leap in Latin America. Finally, justification for David Bowie and Mick Jagger hollering “South Americaaaah!” on their Dancing In The Street duet.
1
Pondering how to pronounce IFPI: David Bowie (left) and The Rolling Stones (right)
MODEST MICE The global business grew 5.9% to $15.7 billion (£12.2bn) in 2016, which amounts to almost an extra $1bn (£775m) in the coffers. IFPI CEO Frances Moore describes that as “modest”, which seems like an odd way to describe a billion dollars. Why? You only have to look back at the previous years of the report. In 1999, the biz was worth a whopping great $23.8bn (£18.5bn at today’s exchange rate) so, even with this year’s boost, the biz is still down $8.1bn (£6.3bn). So maybe celebrate with prosecco rather than champagne.
2
You know when the teacher talks and all Charlie Brown hears is “wah wah” noises? Well, that’s surely what happens to most people when the biz starts waffling on about the so-called ‘value gap’ for the umpteenth time. The report claims that, while Spotify contributed $20 (£15.51) per user in 2015, YouTube users coughed up less than $1 (£78p) each. That doesn’t sound great, but user upload services still contributed $553m (£429m) to the biz. Don’t know about you, but our accountant has described that as officially “worth having”.
3 MUSIC Week CUT THE GAP
THE UK STILL RULES Want a pre-Brexit feelgood boost? The UK is still the third biggest music market in the world, worth $1.25bn (£969m) in 2016, $39m (£30m) ahead of Germany in fourth. For digital in general and streaming in particular, we do even better, coming in as the No.2 market globally, behind only the US. This may also finally explain David Bowie and Mick Jagger pronouncing UK as “Ooooohkay” in that Dancing In The Street duet.
4
WANT TO SELL CDS?GO TOJAPAN. OR GERMANY For all of streaming’s increasing global ubiquity, some of the planet’s biggest markets remain heavily skewed towards physical product. Japan is the world’s biggest physical market, ahead of even the US. Germany is third. And even France – fifth biggest market overall – still gets more revenues from physical than digital. Physical revenues declined 7.6% overall – more than last year – but if those markets ever give up the CD ghost you can expect that to accelerate a lot faster.
5
NEW FRONTIERS Perhaps the most amazing thing about streaming is its ability to open up territories that contributed little or nothing as physical or download markets. According to IFPI data, China is the No.34 market for physical product, but No.7 on streaming. Expect the People’s Republic to break into the overall Top 10 markets next year.
6
KNOWING YOUR A&R FROM YOUR ELBOW According to the report, record companies made a total global investment in A&R and marketing of over $4.5bn (£3.5bn) in 2015. Given the absence of significant artist breakthroughs in 2016, you could argue that that was simply a colossal waste of money (although, of course, A&R and marketing budgets cover an awful lot more than just brand new acts). According to the IFPI, this means music outranked most other industries in terms of its percentage of investment in research and development. What it doesn’t tell us, of course, is whether that level of investment can continue in the streaming age, where catalogue is king and new artists struggle to get traction. Things have improved in 2017, but watch this space...
7
PENTAWHATNOW? You could probably list most of the makers of the Top 10 global albums on 2016 without even thinking about it. Blah blah Beyoncé, blah blah Adele, blah blah Drake. But what’s this at No.10? A Pentatonix Christmas by Pentatonix? We’ve checked and it’s not a misprint, which means we now need to go and find out a) who the hell they are (a five member American a cappella group, apparently) and b) how to pronounce their name. Where are David Bowie and Mick Jagger when you need them? At No.5 and No.6 respectively, actually, with Blackstar and Blue & Lonesome. Good to know some things never change…
8 MAY 01 17
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40
