New issue of Music & Copyright with South Korea country report

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

Apple adopts a light approach to music bundling, reflecting wider trend
Apple is taking a route well-trodden by other music subscription providers and is partnering with mobile operators to add Apple Music to smartphone tariffs. But it is shying away from entering into full-blown “bundling” deals with operators, in which the cost of subscribing to a music service is incorporated into a mobile subscription plan – otherwise known as “hard” bundles. Instead it is offering Apple Music as a bolt-on tariff. The only difference to paying for the service via the usual means is that users get a longer free trial period – and they pay via their mobile bill or prepaid airtime credit. This echoes a wider market trend, since bolt-ons have accounted for an increasing proportion of music mobile bundle deployments this year.

Music subscriptions and the pay-TV blueprint for success
Just over 30 or so years ago, multichannel-TV services began tempting TV households to pay to receive their TV entertainment. Apart from a license fee in some countries, TV services had previously been provided free of charge. More channels, exclusive content, and better-quality pictures led households to sign up to TV-subscription services in their millions, and the pay-TV sector is now worth more than $200bn. Music-subscription services are riding a wave similar to the one the pay-TV sector experienced in its infancy, with rollout strategies strikingly similar to those used in the early days of multichannel TV. With recorded-music sales on the rise and with paid subscriptions soon to account for more than half of consumer spending on recorded music, access services are certainly bringing back the good times for record companies. The big question is whether the growth period for music subscriptions will be able to match the continued success of the pay-TV sector.

Flat year for RAO as government reform of royalty collections looms large
Russian authors’ society RAO has reported a flat year for royalty collections after four straight years of growth. Total income edged down year-on-year in 2015, with collections suffering from the ongoing economic recession in the country. The income figure was still the second-highest in RAO’s history, with increased collections from general performance, grand rights, and overseas. However, the decline in broadcasting and private copying income dented the overall total. The publication of RAO’s business report for 2015 comes at the same time news reports in the country suggested the Russian government was moving forward with is plans to reform the business of royalty collections. The current system of multiple collection societies may well be replaced by a government-run entity that manages all the different rights and issues licenses to music users and processes rights-holder distributions.

South Korea country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed South Korea music industry report. South Korea’s recorded-music industry is the most advanced in the world. In the last 15 years or so, the sector has been through a massive transformation, from being almost overrun by piracy at the turn of the century to one that is now dominated by digital access services. Surprisingly, sales of CD albums are still healthy in the country despite the continued rise of digital sales. Korean-produced music is popular worldwide, benefitting from the “Korean Wave,” which began in the late 1990s and continues to boost the popularity of South Korean popular culture through online services and social media. Local music groups dominate the distribution of recorded music and the major labels account for a low market share. Authors’ society KOMCA exceeded its budgeted collection total for last year and is expecting further growth this year. Live music sales continue to benefit from the popularity of K-pop. However, strained relations with China may affect exports of this music genre to the world’s most populous country.

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Music & Copyright is published by Ovum.