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The latest issue of the newsletter begins by examining the news that UK music trade association the BPI sent its 50 millionth takedown request to Google earlier this month as part of an ongoing battle to limit the distribution of unauthorized recorded music online. At the same time, Google and Microsoft announced that they were making it more difficult for Internet users to search for images of child abuse, following criticism from the UK’s prime minister, David Cameron, in July that the two search giants were not doing enough to prevent access to illegal images.
Inevitably after any announcement concerning the limiting of access to a particular type of content, there are calls to introduce similar measures to control access to unauthorized music and media content. Certainly child abuse is a far more serious crime than copyright infringement, and rights holders would not argue to the contrary. But what the latest Google/Microsoft initiative shows is that technology exists that can be used to tighten controls over content distribution. The big question is when those controls should be used, if at all.
Some good news from France – trade revenues from recorded-music sales increased 7.2% year-on-year in the first nine months of this year, according to trade association SNEP. A big jump in CD sales and rising interest in subscriptions boosted sales. Digital-album sales also increased, but single-track downloads fell, with trade revenues from the format down 16% year-on-year in 3Q13.
Not so good news in Japan – digital-music sales in the country are set to fall for the fourth consecutive year in 2013. New figures published by the trade body the RIAJ show that mobile music formats are continuing to suffer big drops in sales. Internet sales are growing but not fast enough to head off another annual decline. However, there is a glimmer of hope for next year, with quarterly Internet gains slowing the overall rate of digital contraction.
In addition to financial results for UMG, published earlier this month by parent company Vivendi, the latest issue also has a special focus on music apps. The rapid take-up of smartphones and tablets has led to a proliferation of apps. But apart from a few high-profile applications from leading artists, the music industry has scarcely embraced the medium, let alone figured out how to make money off of it.
Belgium comes under the Music & Copyright spotlight this time around. Belgium experienced a lower fall in trade revenues from recorded-music sales last year than in 2011 with digital sales increasing for the second consecutive year after a blip in 2010. However, digital remains a long way from compensating for the drop in CD sales. On the positive side, Belgium’s live sector continues to perform well despite a fragile economy, and royalty collections returned to growth in 2012 after a big fall in 2011.
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According to its latest filing with Companies House in the UK, where it is based, Spotify posted a decrease in revenues, from £96.5 million in 2011, to £92.6 million in 2012. Advertising revenue increased, from £8.1 million to £9.1 million, but sales of subscriptions were down, from £72.5 million to £64.8 million. Losses after tax for 2012 totaled £10.1 million, reversing a £21 million profit in 2011.
It is worth noting that the new figures are for Spotify Ltd only – the Spotify Group accounts came out in July and showed the subscription service generated revenues of €434.7 million (US$584 million) last year, up 128.3% from €190.4 million in 2011. Those accounts were filed with the registry of companies in Luxembourg by its holding company, Spotify Technology. Also worth pointing out is that during the first 5 months of 2011, global premium revenue was recognized in Spotify Ltd. But from as from June 2011 the premium service was provided locally and so the revenue was recognized in the local sales subscriptions.
The rate of growth in the wider subscription sector makes the UK figures a little misleading, particularly given the number of markets Spotify is now available in. Although the company hasn’t updated its subscriber numbers since March (6 million paying users and 24 million active users), both those totals will have increased. By how much, we will all have to wait and see.
Music & Copyright
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For anyone interested in the recorded-music industry and where it is headed, it is difficult to escape the many articles and reports speculating on how music will be served to consumers in the coming years. For those living in Norway or Sweden the answer is already very clear with music subscription services leading the charge to a growth in sales after countless years of decline. Such has been the rise in music subscriptions in the two countries, streaming now forms part of sales charts published each week. IFPI Norway added streaming to album charts from the beginning of November. Previously, the album chart had only included physical sales and downloads. Sweden added streaming to its national album chart in October. IFPI Norway said by including streaming figures the album and singles charts reflected “the total consumption of music in Norway.” Streaming has been included in the Norwegian singles chart since the spring of 2011.
Adding streaming usage to a sales chart is a natural progression in the collation of music sales and recognition of how accessing recorded-music has changed. Excluding streaming from sales charts, particularly in a country where the majority of trade revenues now come from subscription services, would make those charts incomplete, unrepresentative and irrelevant. Continue reading
Music-subscription services are in the headlines for one reason or another on an almost daily basis. The leading services are either hailed as the savior of the recorded-music industry or are criticized for not paying artists enough for the use of their music. Arguments and differences of opinion will most likely rumble on for years to come until the next big thing emerges promising a brighter future for all.
What should be remembered is that despite the rapid rise to dominance in some northern European countries, the subscription model is still in the early stages of development. Plenty of artists initially held off from making their music available to download stores, but virtually all of the big-name holdouts have now relented. It is also worth noting that subscription services have only just scratched the surface of what they can offer. Take the latest deal between the Norwegian music-streaming service WiMP and the Olav Thon Group (OTG) announced this week. WiMP is to provide unlimited music for users of the OTG’s hotels and restaurants across Scandinavia. If that sort of deal became common elsewhere in the world then subscription revenues would start to look pretty healthy and the doomsayers just might change their minds over the benefits of streaming. Continue reading
Earlier this month Music & Copyright conducted its third annual survey of unauthorized music download sites. Like last year and the year before, advertising for a large number of blue-chip companies and media-content services was found on several of the sites surveyed. Most of the companies contacted by Music & Copyright were fairly oblivious to the fact that their ads appeared alongside promotions for “Russian wives” and “Asian babes.” None of the companies placed the ads on the websites, but were displayed through the use of blind advertising networks.
The current issue of Music & Copyright gives all the details on which companies were the worst offenders and which were doing their best to control advertising overspill. But what was interesting this time around was the realization of the problem rights holders face when trying to have content removed from unauthorized music download sites and the support these sites receive from the big social networks. Continue reading
Informa Telecoms & Media today announced the publication of the second edition of its highly successful report Demystifying Pan-European digital-music rights. The report neatly illustrates what repertoire is controlled by what collection society or licensing hub in 30 of Europe’s most vibrant recorded-music markets. Continue reading
New research published today by the Informa Telecoms & Media news service Music & Copyright reveals that global retail sales of rock music increased 2.9% last year, to US$6 million, from US$5.8 million in 2011. Pop may still be the world’s most popular type of music, but retail sales of the genre were down 1%, to US$7.4 million, from US$7.5 million. Continue reading
In the past few months the publication of detailed national digital-music sales figures has illustrated great differences between countries’ digital-music-buying habits. Published analysis of digital-music sales patterns has drawn a variety of conclusions regarding whether subscription streaming services are cannibalizing download sales. However, as subscribing to music starts to become mainstream and download sales begin leveling off, or falling, more and more people are asking whether streaming is to blame. Continue reading
Talking to rights holders in the run up to the CISAC World Creators Summit in Washington, it seems that few agree that any country has the right balance between certain technology companies’ use of music and the abuse of copyright. Google has been on the receiving end of several legal actions by a number of rights holders that have claimed its online video service YouTube has either not acted quickly enough to remove content when asked, or is using content that it has no license for. Ever-troubling for rights holders is the fact that it is their responsibility to check whether music is being used correctly and not the responsibility of the digital-music service. Continue reading
Google has launched a music-subscription service to complement the sale of music downloads from Google Play. The strangely titled Google Play Music All Access will go up against the likes of Spotify, Rdio, Rhapsody and Xbox Music in the US, with overseas rollouts expected soon. There is no advertising-supported tier, and a monthly subscription costs US$9.99. An introductory price of US$7.99 is in place until the end of June. Like its rivals, All Access offers curated playlists and suggested music-discovery options. All Access ties in with Google’s music-locker service, which provides storage for up to 20,000 tracks owned by a user. Continue reading