This afternoon sees the publication of the IFPI’s Global Music Report. It’s the industry body’s annual assessment of how the recorded music industry is growing. You can read our analysis of the report here.
This morning, the IFPI held a press conference in London, with journalists elsewhere in the world Zooming in. IFPI boss Frances Moore and a panel of major-label executives offered their views on some of the report’s trends. Here are some of the key points.
‘It’s growth on top of growth’
Global revenues grew 18.5% in 2021, but only 9% in 2022 – something we’ve examined in our main writeup. Moore stressed that the growth rate more than halving was not a major concern.
“It’s growth on top of growth,” she said. “18.5 last year really was due to the boost given by the post-pandemic [recovery]. This is the eighth year of growth, and it’s definitely something to be excited about.”
She also drew attention to the fact that this is not just a streaming story. “We saw resilience in physical, we saw performance rights return to their pre-pandemic level much quicker than we thought they would, and we saw quite a substantial increase in sync.”
Moore also called attention to the fact that for the second year in a row, all 62 markets that the IFPI reports on saw growth in 2022.
“China has just moved to become the fifth largest market globally, replacing France,” she added. “That’s really something. It’s the first time, really since records began, that we’ve seen any change in the top five.”
‘In 2022 emerging markets led the way’
Universal Music Group’s Adam Granite was very clear in his assessment of last year’s key trend. “In 2022, emerging markets led the way,” he said. That may be referring to growth, with Africa, Latin America and the Middle East and North Africa (MENA) the three fastest-growing markets.
However, Granite also pointed out that “if you look at the top 10 artists in the world in 2022, they are from seven different countries”. Proof, in his eyes, of a growing diversity (in geographic terms) at the highest level of musical stardom.
‘Moving more consumers from free to paid remains critically important’
Sony Music’s Dennis Kooker was also on the panel, and his initial address focused on streaming, and the importance of “convincing consumers of the value of music and getting them to pay for music”.
He noted that around 75% of streaming revenue now comes from paid subscriptions “even though the majority of users are actually on the free, ad-supported model”.
Kooker also suggested that these free models are “more sensitive to cyclical impacts”, including the recent economic wobbles around the world. He suggested that this should be a spur to continue seeking ways to convince free streamers to start paying.
“Having that ecosystem that works in moving consumers from free to paid remains critically important if we’re going to continue to grow the business.”
‘It’s starting to go beyond the diaspora’
Warner Music Group’s Simon Robson was another panelist, and he trained his attention squarely on those three fastest-growing regions: the so-called ‘high potential’ markets.
Of MENA, he noted that there was “not just a growth in the region, but also the growth in demand for the music outside the region”.
When we talk about this kind of trend, the music industry often thinks of this as driven by diasporas: in this case, people of Middle Eastern and North African origins or heritage who live elsewhere in the world. However, Robson said it’s not just that.
“Sure, you’ve got the diaspora, but I feel it’s starting to go beyond the diaspora into other people stating to pick up and listen to this music,” he said.
“As the markets grow, you’re also seeing an abundance of really strong local talent coming through. It’s early days still for MENA, but I’m confident that we’ll start to see artists from MENA influencing the global charts.”
For WMG, cross-cultural collaborations will be a key tactic in making that happen: he cited the example of Ricky Rich, a Swedish rapper of Middle Eastern heritage, whose ‘Habibi’ track has so far seen six “collab remixes” with artists from countries ranging from Germany to India, helping push its global streams to more than 300m.
“It definitely feels like the cultural and commercial axes of the world are starting to shift,” said Robson.
‘LatAm is a spectacular success story’
As a recorded-music region, Latin America was worth $1.3bn last year, with Robson noting that in 2017 it was worth $450m. “It’s close to tripled in just five years,” he said, noting that Brazil has also just returned to the IFPI’s top 10 markets.
“Not just a 10, a new peak at number nine. I feel this time Brazil’s here to stay in the top 10, which is pretty groundbreaking,” he said. But the $1.3bn isn’t the half of it… literally.
“LatAM also is becoming increasingly influential in the US market, and it is the fastest growing segment of the US market,” said Robson. “When you add in the US segment, it nearly doubles the size of the LatAm market, and I think that’s really important to understand… it is really, really significant when combined.”
‘We will see Indian music have a much bigger impact’
Local tracks going global was a theme. Robson talked about a WMG track called ‘Maan Meri Jaan’ by King becoming a top-30 hit on Spotify [globally] purely through the sheer volume of streams from Indian listeners.
“It feels like this is the start where we will see Indian music have a much bigger impact,” said Robson.
Universal Music’s Devraj Sanyal was also on hand to talk about India, and a shift that is seeing “an explosion of the entire singer/songwriter music coming through” despite the traditional dominance of film-music from Bollywood and other local movie industries.
Sanyal talked up the growth of local pop, hip-hop and indie, as well as music created in big regional languages. Even in the film-music world there is change: new regions like the south of India are making their presence felt – recent Oscar-winner ‘Naatu Naatu’ included.
“The first few steps of an actual global crossover are now here,” said Sanyal. “It’s time now for our market to truly play its role in the global streamscape.”
Later, Adam Granite would talk about India in the context of K-Pop, Afrobeats and Reggaeton as genres that had broken out of their home regions. “We’re working really hard to make Indian repertoire next,” he said.
‘It’s just the diversity of the genres on the continent’
Warner Music Group’s Temi Adeniji was also on the panel to talk about trends in Africa. One of her key points was about diversity: that African music is much more than just Afrobeats, which is the genre that has (so far) received most attention globally.
“It’s just the diversity of the genres on the continent, and the opportunities that exist beyond Afrobeats in my opinion,” she said, citing Amapiano from the south and Bongo Flava from eastern Africa as key candidates for similar popularity abroad.
She also talked about how these genres do not exist in isolation: that they build upon music, genres and scenes that have gone before them – context that may not be known by western listeners, but which is important to how these genres are evolving.
“Old catalogue is being resurrected through new music. Quite a lot of artists coming up with the traditional Afrobeats sound are actually resurrecting Afrobeat music from the past,” she said – the plural and singulars are important there, and here’s a mini-primer on that.
“That’s extremely important, number one for the culture, but also in terms of connecting the new with the old, and seeing how historically the sounds are transforming into what we now consider Afrobeats and Amapiano.”
“The borders between different genres of music have never been so porous,” she added. For example, log drums are traditionally an Amapiano instrument, but they’re increasingly being used in Afrobeats tracks too.
‘NFTs is a massive opportunity to have relationships with core fans’
Have major labels jumped aboard the NFT-backlash bandwagon? Not in Simon Robson’s case. “The reputation in that area has taken quite a big hit, but that was because the market was driven by speculators,” he said.
“The dust is still settling, but we feel at Warner that NFTs is a massive opportunity to have relationships with core fans: effectively digital fan clubs,” he said, citing Snoop Dogg as one innovator in this area.
“I actually feel the potential to grow in these areas is really exciting,” continued Robson, noting that because “the established markets will be the first territories to benefit” from this, it may be helpful in staving off the prospect of a ceiling for recorded music’s growth in the most mature streaming markets.
‘France is the most local market in the world’
France may have been bumped out of the top five global music markets by China, but there are positive trends there too according to Sony Music’s Marie-Anne Robert.
“Our domestic repertoire is growing a lot. France is the most local market in Europe, with local artists making up 77% of the top 200,” she said. Sony Music has seen its percentage rising from 44% to 60% reflecting the same trend.
She also noted that French people listen to more than 10 music genres on average (“about a quarter more than the global average”) and spend 17 hours a week listening to music, with streaming around half that time, but radio and TV still playing an important role.
She also talked about the policy environment, noting that it is still “very much geared towards supporting French art, and especially music, across television and radio”. She sees this as “a huge opportunity for catalogue”.
Something else that Robert said, as a brief aside, was that “speed has become key in discovering and signing artists”. That’s a quote we’ll look to dig into more in the coming weeks.
She also talked about the importance of diversity in A&R recruitment. “Building the pipeline of the next generation of A&Rs in a diverse way is crucial to the continued success of the music industry.”
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