New issue of Music & Copyright with Indonesia country report

The latest issue of Music & Copyright is now available for subscribers to download. Here are some of the highlights.

Just how big is recorded music streaming going to be?
In a fairly short space of time, music streaming has become the most important distribution means for the recorded music sector. Earlier this year the IFPI reported that streaming gains were behind the first substantial growth in global trade earnings for almost 20 years. Add to this the fact that all the major labels have confirmed in the last few weeks that streaming was the top recorded music revenue source in the first quarter of this year. We look at the latest developments in the music subscription sector and explains why streaming is now so important for the recorded music industry. It also predicts just how high the total number of paying subscribers could reach by 2020.

Subscription gains fail to offset physical format decline in Japan
The Japanese music trade association, the RIAJ, has reported physical and digital recorded music trade figures for the first three months of this year. Production levels of physical formats suffered a modest decline in the period compared with the same period of 2015. In contrast, total record company earnings from digital sales and services increased year on year in the quarter. However, the rate of growth in digital sales was not sufficient to fully offset the physical format declines. Although record companies in Japan will welcome the rise in digital revenue, physical formats still account for more than 80% of total trade earnings in the country. There is a real fear that any acceleration in the contraction rate of physical format sales could spell a tough few years for the Japanese recorded music sector.

Streaming and manufacturing initiatives set to bolster the vinyl renaissance
Vinyl remains in resurgence as consumers continue to show an appetite for the traditional analog format. But demand is stretching the industry to the limit and established vinyl pressers are struggling to keep pace, hamstrung by antiquated equipment, with record companies relying on old engineering from central Europe to feed the pipeline. There are, however, plenty of signs of innovation on the manufacturing side as fresh blood is drawn to the business. The age-old format might also be in line for an HD upgrade.

Indonesia country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Indonesia music industry profile. Indonesia has the third-largest population in Asia after China and India. Like the two leaders, it has for many years been thought of as a music market that offers great potential. But as a marketplace for creative content, it has been badly hit by the widespread availability of pirate recordings, and unauthorized CD albums are on sale throughout the country for a fraction of the price of legitimate copies. More recently, digital piracy has grown in line with Internet access. Indonesia is no different from a number of other Asian territories where music piracy is widespread. However, unlike many countries in the region, Indonesia has made notable improvements on intellectual property rights protection. Mobile personalization is currently the biggest revenue generator for record companies in the country. But several of the international music subscription services have set up shop in Indonesia and there is real hope for the future of recorded music sales. Indonesia’s digital infrastructure is also developing well with smartphone penetration on the rise. Essentially, all of the requirements for further digital growth are firmly in place.

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Music & Copyright is published by Ovum.