Category: Music industry

New issue of Music & Copyright with France country report

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

EC green-lights GEMA, PRS, and STIM pan-European online music licensing hub
The European Commission has given its approval to a joint online music-licensing venture between the three European collection societies GEMA, PRS for Music, and STIM. In January, the EC began an-depth investigation to determine if the venture was in line with European Union regulations on mergers. The investigation was launched after a preliminary investigation suggested that the combination of music repertoires currently controlled by the three collection societies could result in higher prices and worsened commercial conditions for digital service providers in the European Economic Area. In a joint statement, GEMA, PRS for Music, and STIM said the new hub will transform pan-European music licensing by enabling ease of access for digital music services to music rights as well as provide faster and more accurate payments of royalties to writers and their music publishers.

Both BUMA and STEMRA report collection growth in 2014
Dutch authors’ societies BUMA and STEMRA have reported a third consecutive year of growth in joint collections after three consecutive annual falls. Combined income for the two collection societies increased 5.3% last year, with gains reported in both performance and mechanical rights. Strong growth in streaming in the Netherlands resulted in an almost doubling of digital collections for BUMA. However, streaming remains a tiny source of revenue for authors and publishers in the country.

US Copyright Office opens up the debate on the future of orphan works
The US Copyright Office (USCO) has begun a new review of how best to deal with orphan works and mass digitization under the country’s copyright law. Earlier this year, the USCO asked for comments from stakeholders and held a number of public roundtables in Washington D.C. The culmination of viewpoints, as well as an analysis of issues impacting orphan works and mass digitization efforts along with a series of recommendations, has been published in a new report. The USCO has requested written comments on its recommendations be submitted by early August.

After the indie and Swift storm, Apple Music is all set to deliver the music streaming tipping point
Apple’s foray into music streaming has been a long time coming but Apple Music is set to hit the ground running. However, those who expected cool Apple to innovate in the streaming space need to “think different” as the company has designed a service which is pretty much a grab bag of features already out in the market. While that may be a disappointment for some, it is not necessarily a bad move. All Apple needs to do is provide a good, dependable music streaming service akin to Spotify’s and its marketing clout and the huge global penetration rate of its consumer electronics devices should ensure that becomes market leader. However, Apple Music is not about to wipe out the competition and the service’s launch will serve to lift most streamers’ boats.

France country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed France music industry profile. The French music industry experienced a contracted 2014 with recorded music sales and royalty collections both suffering a decline after a positive 2013. Despite the rise in music subscription and streaming revenue, continued falls in CD album and music download sales dragged down overall recorded music trade income. French authors’ society SACEM also suffered a reversal of fortune with the ongoing decrease in mechanicals overshadowing digital and broadcasting gains. France’s live music industry is highly competitive with national and international promoters battling for big name representation. High fees charged by leading artists make it difficult for promoters to return a profit and the increased concentration on bigger shows and festivals is causing a real headache for the country’s smaller events.

If you want to know more about Music & Copyright then follow the below links.

Music & Copyright is published by Ovum.

New issue of Music & Copyright with Germany country report

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

PWC charts the recorded music gloom and live music boom
PricewaterhouseCoopers (PwC) has published its annual assessment and forecasts for the recorded music and live music industry sectors. The figures make healthy reading for those involved in the live sector, but, despite the forecast rise of digital, the steady fall in sales of CD albums will mean total recorded music sales will continue to shrink for the next five years at least. Overall, combined revenue from live and recorded music will grow annually in the five years up to and including 2019, edging ever closer to the magical $50bn mark.

Collections return to growth for JASRAC in 2014
Japanese authors’ society JASRAC has reported a return to growth for royalty collections in the 12 months to the end of March 2015, after a decline in the previous 12-month period. Despite a fall in both mechanicals and overseas revenue, the rise in domestic performance income, most notably from live performance, boosted overall collections. Broadcasting remained the biggest single source of earnings for Japanese authors. Digital collections edged up in line with the total increase in digital-music sales in Japan last year.

Digital and broadcasting gains boost STIM revenue to record high
Swedish authors’ society STIM has reported another record financial year with total collections and distributions to its members topping the previous records set in 2013. Digital collections were again the star performer with income from digital music services accounting for the second biggest share of domestic income sources. A better year for advertising in Sweden boosted commercial broadcast collections. However, royalties from festivals and live music concerts suffered a big drop after a sharp rise in 2013.

SFX Entertainment and the need to curb its EDM ambitions
SFX Entertainment has had a short and eventful life. The electronic dance music (EDM) specialist is only three years old but, not short on ambition, it has adopted an acquisitions-led growth strategy that has turned it into a $350m-a-year company. But rapid expansion has come at a cost and SFX has yet to turn a profit. For the company’s striving CEO, that does not seem to pose much of a problem. But SFX is listed on the NASDAQ exchange, its stock price has suffered, and its strategy has been heavily criticized. Now the company, which only launched its IPO at the tail-end of 2013, is looking to de-list and get out of the spotlight. But it is not clear that SFX will fare any differently as a private company if it does not change its high-growth tack. Moreover, it may not survive as a stand-alone entity.

Germany country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Germany music industry profile. Retail sales of recorded-music in Germany increased for the second consecutive year in 2014. German trade association BVMI reported a 1.8% rise in consumer spending on recorded music compared with 2013. Revenue from subscriptions and streaming fully offset the falls in spending on music downloads and CD album sales. However, despite the digital transition gathering pace, physical formats still account for more than two-thirds of consumer spending. In line with recorded music spending, authors’ society GEMA also reported a second consecutive year of collection growth. Despite difficult market conditions, GEMA said collections were positive for almost all of its business sectors with digital experiencing the highest growth. Germany’s live industry, the biggest in Europe, is in good shape with new festival launches heightening an already competitive sector.

If you want to know more about Music & Copyright then follow the below links.

Music & Copyright is published by Ovum.

New issue of Music & Copyright with UK country report

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

BMI wins the latest royalty battle in the ongoing rate dispute with Pandora
A New York rate court has decided that US online radio service Pandora must pay BMI, the performing rights organization (PRO), 2.5% of revenue for the use of authors’ and music publishers’ content. In making its decision, the US District Court for the Southern District of New York decided that the rate proposed by BMI was reasonable, despite being at the low end of what BMI had hoped for. However, the rate is still higher that the 1.85% rate Pandora pays to ASCAP. That rate was affirmed by the US Second Circuit Court of Appeals in April after ASCAP had appealed a 2014 rate court decision. Previously, Pandora had paid BMI 1.75% of revenue and so, with the online radio service expected to generate around $1bn in revenue this year, the increased royalty payment to BMI could be as high as $75m. Pandora, which ended March with 79.2 million users, has said it will appeal the New York rate court decision.

Public performance gains return Czech authors’ society OSA to growth in 2014
Czech authors’ society OSA has reported a return to growth in royalty collections in 2014 after a slight dip in 2013. Despite a fall in broadcasting income and earnings from abroad, record collections from both public performance and digital boosted the authors’ society’s revenue to a new high. A good year for OSA also included a fall in costs and a subsequent decrease in costs as a share of collections, as well as a rise in distributions to its members.

Growth for all the major music groups in 1Q15
With UMG the last of the three major music companies to publish financial details for the first three months of 2015, a comparison of their respective performances reveals all of the companies posted year-on-year growth. Previous year-on-year comparisons of the three companies’ recorded music and music publishing sectors have been distorted by company acquisitions and sell-offs, and exchange rate fluctuations. However, with most dealings completed more than a year ago, the only major influencing factor in first quarter comparisons was exchange rates. Factoring in fluctuating current rates suggests that all three majors have got off to a good start in 2015. There are, however, still nagging doubts as to whether 2015 will be the year that the recorded music sector as a whole posts positive gains, and whether music publishing can register another year of growth.

On the Radar: BackBeat Solutions
A new “on the radar” section in Music & Copyright begins with a look at BackBeat Solutions, a company that provides pre-packaged deal management, royalties accounting, multi-platform publishing, and content services. It has a client portfolio in Europe and the US comprising tier-two music labels and music publishers. Founder Chris Chambers’ long association with the music licensing area has helped it secure projects for BMG Chrysalis, Fintage House, and Imagem Music Publishing.

UK country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed UK music industry profile. Optimism about a return to longer-term recorded music growth in the UK was quickly extinguished with the publication of last year’s trade results. Three straight years of decline ended in 2013 with a rise in trade revenue. However, recorded music sales slipped back again in 2014 with the rising income from streaming services unable to match the drop in downloads and CD album sales. The UK may well register growth again this year though as streaming increases in popularity. Royalty collections matched the recorded music decline last year with PRS for Music registering its first rights contraction since 2010. A rise in broadcast, digital, and public performance collections could not fully offset the fall in overseas income and mechanicals. The live sector remains strong, although research suggests small venues are under considerable pressure, both financially and regulatory.

If you want to know more about Music & Copyright then follow the below links.

Music & Copyright is published by Ovum.

New issue of Music & Copyright with China country report

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

European Commission sets out its 16-point plan for the Digital Single Market
The European Commission has published details of how it intends to create a Digital Single Market in the region. The new plan sets out a number of targeted actions to be delivered by the end of 2016. The plan is separated into three specific areas aimed at providing better access for consumers and businesses to digital goods and services across Europe, creating the right conditions for digital networks and services to flourish, and maximizing the growth potential of the digital economy. Of particular interest to the music industry are the Commission’s plans to end geoblocking and its legislative proposals for a new copyright law aimed at reducing the differences between national copyright regimes. Continue reading

Recorded music market share gains for WMG in 2014, Sony/ATV is the publishing leader

The annual survey by Ovum publication Music & Copyright of the recorded music and music publishing sectors has revealed that recorded-music leader UMG lost market share in 2014, mainly as a result of the sale of the Parlophone Label Group (PLG) to WMG in 2013, which formed part of EMI Recorded Music acquisition requirements. UMG’s loss was WMG’s gain and the smallest of the three majors narrowed the gap on second-placed SME. Sony/ATV held its lead in music publishing, but the collective share of the independent publishing sector was the highest overall.

Majors cede a little recorded-music market share to the independents
Following two years of consolidation in the recorded-music and music-publishing sectors after the breakup of EMI Music Group and the subsequent sales of EMI’s record and publishing divisions, restructuring and company selloffs have had an impact on the market share figures for the major music groups in 2014.
UMG acquired EMI Recorded Music and a Sony-led consortium of companies bought EMI Music Publishing in 2012. National and regulatory approval required a number of company sales, which were completed with the sale of the PLG in July 2013. The timing of the sale meant year-on-year market-share comparisons for UMG and WMG this year and in 2013 were affected. Moreover, at the time of the PLG acquisition by WMG, the major said it would sell some of the PLG assets, or their equivalent value of owned assets, to independent companies. Strong interest by the independent sector has delayed the asset sales with more than 140 companies reported to have bid for around 11,000 artist catalogs. Should the selloffs be completed this year, WMG’s 2015 market share may well be negatively affected.

UMG is the recorded-music leader despite a market share dip
According to Music & Copyright’s annual survey of the music industry, UMG had a 34.1% share of the combined physical and digital recorded music trade revenue last year, down from 36.7% in 2013. For physical revenue only, UMG’s share stood at 32.3%, while its digital share was 36.1%. SME was the second-largest music company, with a virtually unchanged combined physical/digital market share of 22.5%.

Record companies, physical and digital revenue market shares, 2012–14
Recorded shares 2014
Source: Music & Copyright

The smallest of the three majors, WMG, was the only company to experience an increase in both physical and digital shares: Its share of revenue from physical recorded music sales was 15.7% in 2014, up from 14.8% in 2013, while the share gain was slightly lower for digital, rising to 17.7%, from 17.1%. WMG’s combined physical/digital share grew, to 16.7%, from 15.8%.
The independent record companies’ share of combined physical/digital revenue also rose last year, to 26.7%, from 25.1% in 2013. The sector increased its share of both physical and digital revenue. However, the independents’ share of physical formats is still higher than its digital share.

A healthy year for music publishing
Music & Copyright has calculated that global music publishing revenue grew 2.5% in 2014, to $4.05bn, from $3.95bn in 2013. Despite a virtually unchanged market share in 2014 of 29.5%, Sony/ATV, the joint venture between Sony and the Michael Jackson Estate, remained the global publishing leader. Although Sony/ATV and EMI MP are still separate companies, with EMI MP repertoire administered by Sony/ATV, Music & Copyright has combined the companies’ shares. EMI MP is the larger of the two companies in terms of tracks owned and administered, with a publishing catalog of around 2 million tracks, compared with 1.6 million for Sony/ATV.

Music publishing companies, revenue market shares, 2012–14
Publishing shares
Source: Music & Copyright

UMPG is the second-largest music publisher. The company’s market share edged up slightly last year, to 23.0%, from 22.6% in 2013. Warner Chappell was the only major music publisher to suffer a fall in share in 2014.

Independent companies hold the lead
Independent music publishers have long dominated music publishing and compete well with the majors for major artists’ attention. Last year, the independent music publishing sector experienced a small increase in share: Music & Copyright estimates that independent companies accounted for 35.0% of global publishing revenue, compared with 34.8% in 2013.
BMG Rights Management is the biggest of the independent music publishers and has gained share consistently through a mixture of company acquisitions and administration deals. Music & Copyright estimates that BMG’s share of global music publishing revenue was 5.4% in 2014, up from 5.1% in 2013.
Kobalt has also made gains in the last few years, although increased revenue for the company has come from organic growth rather than through company acquisition. Music & Copyright estimates that Kobalt’s share of global publishing revenue increased to 3.9% last year, from 3.5% in 2013.

If you want to know more about Music & Copyright then follow the below links.

Music & Copyright is published by Ovum.

New issue of Music & Copyright with global market share details

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

Recorded music market share gains for WMG in 2014, Sony/ATV is the publishing leader
The annual survey by Ovum publication Music & Copyright of the recorded music and music publishing sectors has revealed changes in global market shares of the three major music groups. Recorded music leader UMG lost market share in 2014, mainly as a result of the sale of the Parlophone Label Group (PLG) to WMG in 2013, which formed part of EMI Recorded Music acquisition requirements. UMG’s loss was WMG’s gain and the smallest of the three majors narrowed the gap on second-placed SME. Sony/ATV held its lead in music publishing, but the collective share of the independent publishing sector was the highest overall. Continue reading

Music subscription services face a difficult balancing act between price and value

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