China loves music. Nearly 75% of its 1.3-billion-strong population listens to music regularly; the country’s government even has an official (albeit bizarre) rap song!
Yet the world’s biggest economy (at least by some measures) is tiny in terms of the size of its music market, which is smaller than that of Austria or Switzerland. It’s a mere sliver of the size of the US music industry.
According to the International Federation of the Phonographic Industry (IFPI), the organization that represents the global recording industry, China ranks 19th in music market size.
Rampant piracy is the main reason China is such a bleak place for music companies. Pirated audio content is so available, accessible, and popular that the idea of buying albums or paying for streaming subscriptions can seem absurd—especially to poorer consumers. (The West has a problem with piracy, too, but not to the same extent.)
Given that resistance, and the dueling Chinese services already crowding the market, it’s especially hard for foreign companies to break in. While the IFPI calls China a country of “enormous untapped potential,” it also notes that only 10% of the market goes to non-Chinese-language music right now.
Global music companies hoping to strike gold in China are about to have an even tougher time. As per the Chinese government’s bomb-drop declaration last week that all foreign media companies will be blocked from publishing digital content in the country, any online text, audio, or video content produced abroad—starting March 10—will be in violation (link in Chinese) of national law.
While the new rules may most deeply affect news outlets like the New York Times and the Financial Times, which have invested millions in Chinese expansion in recent years, they’ll also rattle the music business.
The fates of iTunes and Apple Music, for instance—which is available in China—seem entirely up in the air. The new rules say foreign companies will be allowed to publish content if it’s pushed through a Chinese digital distributor, but such rigidity will likely lead to complicated licensing hurdles and may also deter newer, cash-strapped music ventures from attempting to nudge their way into China at all.
By Amy X. Wang
http://qz.com/627527/how-can-china-be-so-big-and-its-music-market-so-small/
[Original article contains a chart that is well worth looking over.] [Thank you to Alex Teitz, http://www.femmusic.com, for contributing this article.]* * * * *
RECORDED MUSIC IS IN TROUBLE BUT LIVE CONCERTS ARE MAKING MORE MONEY THAN EVER
People are streaming music more than ever—which pays peanuts to songwriters (paywall)—and the purchase of albums has become passé. And then there’s music piracy, which won’t go away; even Kanye West can’t stop the tide. But amid these disruptions to recorded music, live concerts are more popular than ever.
Live Nation Entertainment, the world’s biggest concert-organizing company, announced five consecutive years of record revenue when it released its 2015 results yesterday (Feb. 25). Live Nation’s $7.6 billion of revenue is up 11% from the previous year; its on-site advertising grew 17%; its concert and festival attendance saw a boost of 8%; Ticketmaster, the ticket-selling division it acquired six years ago, reported 12% growth in global gross transaction value.
In remarks to shareholders, one particular adjective was proudly uttered by CEO Michael Rapino over and over: “Record.”
Factors driving the explosion include the rise of mobile-ticket sales (which make it easier for fans to snag spots at events) and a surge in global entertainment event growth (which is occurring as musicians dig into emerging markets for new profit).
There’s something else: unlike recorded songs and albums, concerts provide an undiluted connection to music that fans can’t find digitally, no matter how hard online services try to recreate it. As Live Nation said:
Live is a truly unique entertainment form—it cannot be duplicated. It is elevated, not threatened by technology and is borderless. Fans around the world can now discover, follow, share and embrace artists, creating greater demand for live shows.
This, combined with an ongoing shift of consumer spending towards experiences, is helping drive the structural increase in demand for concerts globally.
As the world moves toward digital records and de-personalized music streaming, it seems fans are starting to miss the emotional connections with their favorite artists, and they’re picking up those lost relationships with live events.
Farewell to the album; hello, Coachella.
By Amy X. Wang
http://qz.com/625934/recorded-music-is-in-trouble-but-live-concerts-are-making-more-money-than-ever/
[Thank you to Alex Teitz, http://www.femmusic.com, for contributing this article.]