Music is unquestionably important to most people’s lives, regardless of where they are in the world. Although not everyone spends money on recorded music or buys tickets to a gig or festival, a very high percentage of people listen to music on the radio at home or in their car. Restaurants, shops, and bars use music to create a particular ambience to encourage people to either relax or feel enlivened to improve their customers’ experience.
Music is essential and important
Just how important music is to consumers was one of the many questions included in a consumer survey conducted by Music & Copyright publisher Ovum in July. Over a three-week period, 15,000+ consumers across 15 countries were asked a number of questions about their media use. In terms of importance, music was considered essential by 42% of respondents, and important by a further 43%.
Although listening to music was less important than browsing the Internet and reading the news, it was considered more essential that interacting on social media and watching TV. Only 16% of respondents said listening to music was unimportant. Continue reading
Earlier this week Sweden’s local music trade association Grammofonleverantorernas Forening (GLF) proudly reported that total trade revenues from recorded-music sales increased 5.1% last year, to SEK991.2 million (US$152.2 million), from SEK943.6 million in 2012. The rate of growth was lower than the 13.8% year-on-year increase in 2012, but higher than the 0.5% upswing in 2011. Streaming was the big winner, with record company earnings from services such as Spotify and WiMP rising to SEK705.9 million, from SEK541.6 million in 2012. Based on the latest GLF figures, streaming accounted for slightly more than 71% of total trade revenues in 2013, up from 57.4% in 2012 and just 1.5% in 2008.
In a statement, the GLF CEO Ludvig Werner said three straight years of growth had pushed trade revenues to their highest level since 2004. However, he cautioned that record company earnings are still just 60% of the peak year of 2000.
With all the headlines about Sweden’s streaming boom, it is easy to forget how big the Swedish recorded-music market once was and how far it has fallen. Moreover, there are plenty of questions over how high streaming sales can actually go, particularly given the slowdown in the growth rate of streaming earnings (30.3% in 2013, down from 55.4% in 2012).
In just six years, sales of CDs in Sweden have more than halved, yet there is little published evidence detailing whether those CD buyers have switched to digital or are simply buying less recorded-music. In the early years of digital, falling trade revenues were a clear indicator that consumers were either switching to unauthorized services, or abandoning the recorded-music industry altogether. Download sales have never really taken hold in Sweden and so the big unknown is whether music subscription services have attracted consumers that stopped buying recorded-music, or whether the services are simply causing a redistribution of trade revenues from CDs and downloads.
Rising earnings suggests the growth has come from more than simple cannibalization, but it would be easy to gloss over the possibility that fewer Swedes are spending money on recorded-music, and that those consumers that are spending, are spending more. If that is the case then there will be a limit on how big the streaming boom will take Sweden’s recorded-music sector. No one is expecting streaming sales to keep on rising, but if streaming can’t return record company earnings to 2000 levels, then what can?
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
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
As the issue of multiterritory licensing comes under the spotlight in Europe, differences in rates charged and rights splits will become more evident. Will an EU directive that breaks down national borders be followed by a bigger push for deeper collection-society harmonization across the region?
With publication of the European Commission’s new multiterritory licensing proposals, Brussels’ efforts to harmonize the EU’s digital-music landscape are looking to build on legislation harmonizing authors’ and publishers’ rights that are managed by collection societies. Continue reading
At the end of last month the music industry once again descended on Cannes for the annual institution that is MIDEM. Opinions from the trade floor and the many conferences and panel sessions left visitors in no doubt that there has been a major shift in opinion from across the music industry that streaming and subscription services have really started to take off. Continue reading
Last month the Pan-Nordic mechanical-rights-collection society Nordisk Copyright Bureau (NCB) reported a fall in the total amounts collected and distributed to its owner societies for last year. Despite the decline, NCB described 2010 as an important year and one that removed much of the uncertainty over the collection society’s future. Perhaps more important though, is the fact that NCB and its owner societies have shown that collection societies, if left to their own devices, can develop a very workable multiterritory online licensing system. Continue reading