A few highlights from a Global Music Report by @MusicAlly

Mexico:
-Over 60% of all Mexican label revenue came directly from Spotify
-The World’s streaming mecca, according to Spotify
-20mm people use a streaming service, while 80mm people own a smartphone (& quickly growing)
Brazil:

Amazon Music passed Deezer to become the second DSP in number of subscribers, behind Spotify, which
has 61% of total subscribers and contributed 45% of all Brazilian recorded music revenues in 2019.

Don’t have a very big Apple hardware user base in the country
Brazil (cont.)

Paid streaming accounted for almost three quarters of recorded music revenues in the region

Overall, Brazilians became more aware of the benefits of music streaming services, and started adopting and using it more.
US:

On-demand audio streaming in the US was up 17% year-on-year in 2020

76m subs in 2020. Netflix, by contrast, had 74m subs in the US in 2020.) Music subscription #’s in the US are far from levelling off, as might be expected in what is a relatively mature digital market
US (cont)

“There are well over 200m SVOD subscriptions in the US but SVOD subscribers subscribe to more than 1 service”

Spotify is significantly increasing its share of the podcast mkt- eMarketer claimed that Spotify overtook Apple for podcast listening in the US in 2020
France:

The number of people using premium streaming services in France, meanwhile, is around 12m, including family plans, while another 7.4m people in France use free services, taking the total number of streaming to 19.4m, or slightly under a third of the total population.
Germany:

Relatively slow transition towards a streaming-led music market has been accelerated by the effects of the pandemic, with streaming booming and CD sales - for so long the cornerstone of the German music business - down sharply.
Germany (cont)

Video streaming, is one of the most popular channels for music consumption in Germany but contributes <4% of total revenue.

Among free streaming, YouTube is the number two channel (41%) after Spotify (62%) for people to listen to music via free streaming offers
Netherlands:
“The proportion of people streaming has doubled in the last 8 years and around 60% of them have a premium subscription. People are spending more time listening to music, a hugely positive sign of engagement.”

“More than half the population listens to Spotify”
Russia:

Russia provided one of the standout performances of 2019, with recorded music revenue up 50.3% according to local sources. Streaming grew by almost 76% last year.

“By 2030, Russia is expected to become the tenth largest music market in the world” (116m internet users)
Russia (cont.)

The market also benefited from the high-profile launch of Spotify in July 2020, a move that Spotify called “our most successful new market launch to date”.
“Russia landed in our top 25 markets worldwide in terms of MAU and paid subscribers.”
Needed a break. Here’s Asia.

Australia: Subscriber growth has continued this year “although not as the same levels as previously as the market matures” adding that Australian and New Zealand customers are “ahead of the curve” as strong early adopters of streaming platforms.
China:

Statistics about China’s recorded music industry are generally seen as unreliable.

industry grew 16% in 2019 and it is the seventh biggest market globally with a market size of $590.9m.
China (cont)

A recent report by the Chinese government, however, put the value of China’s digital music industry in 2018 at around $8.76bn, a vast difference from the IFPI figures. The Chinese report includes areas like mobile karaoke that the IFPI does not track.
China (cont)

There are currently 60m paid subscribers in China – a number that is the second highest globally overall but still represents under 5% of the country’s total population.

“That number has more than doubled in the last two years, which is a really positive sign”
China (cont)

Tencent Music (Kugou Music, QQ Music and Kuwo Music) said that it had 657m monthly active users across its three services, of which 42.7m were paying.

2/3 of TME revenues in came from ‘social entertainment’ (mostly karaoke and live video)
China (cont)
The importance of Shuzi Zhuanji or “digital albums”, are albums on platforms that even subscribers have to pay extra to access, either to stream or download. Releasing an album like this is a badge of pride for artists and fans, serving as proof of their popularity
China (cont)

Tencent is integrated with WeChat. So if you share on WeChat that you have purchased 100 copies of, let’s say, the new Taylor Swift album, then you can gift it to 99 people. They have leaderboards – with the most dedicated fans showing off on them.
China (cont)

It’s a very interesting way of bragging about how much money you have and showing that you support the artist”

Taylor Swift, is a pertinent example: the Shuzi Zhuanji release of her most recent album, Folklore, reportedly
made $1.2m in three days on NetEase”
China (cont, yes!)

Sina Weibo (“China’s Twitter”) is another key platform as well as Douyin/TikTok and Tencent QQ. There is NetEase Music’s own Fan Connect, which allows fans to comment publicly on albums and tracks. US singer Lauv recently took part in a fan Q&A on Fan Connect
Even more China:
International artists don’t concentrate as much as they should on Chinese social media. “International artists also need to put in the effort to make their music relevant,”
“There’s no Facebook, no Instagram, no Twitter. One of the things I always ask labels is:
‘Would you do a release without Facebook, Instagram or Twitter?’ And they say, ‘Never!’ And I say, ‘That’s exactly what you do in China!’”

😂 😂 😂
China!

3 years ago foreign music represented about 11% of the Chinese market and this has now increased to around 18%, largely thanks to streaming.

Taylor Swift’s’ Lover shifted 1m album equivalent units in its first week of release, breaking the record for a foreign act
Last one on China:

“a large portion of music listeners are the post-1990s generations who have grown up in the globalisation era, they are more open to new cultural influences and diverse music genres”

We could see China in the top three markets globally within the next 5 years
India!

The majority of the music consumed on Indian streaming services is from film soundtracks

Listenership on audio streaming services grew by 40% year- on-year in the first half of 2020
India (cont)

The impact of the lockdown has been buffered by the exponential increase in the nationwide popularity of “non- film” music.

Gaana, which claims to have 185 million monthly active users (MAUs), making it the nation’s most popular audio-streaming service.
India (cont)

YouTube, more than 265 million MAUs in April 2019, and likely considerably more now.

Gaana’s chief rivals, JioSaavn and Wynk Music, which are owned by telcos and claim over 100 million MAUs, to services like Spotify, and ByteDance’s new entrant Resso.
India (cont)

Gaana began releasing Gaana Originals, a series of exclusives it curates in collaboration with labels, in 2017, the same year JioSaavn launched Artist Originals, an in-house label for independent artists.
More India:
DSPs are discovering that there’s an audience for every kind of music in India, where the sheer numbers –in terms of overall population or smartphone users – have made the country one of the most attractive markets on the globe

India is home to 9 streaming services
India (cont)

The IMI estimates these services collectively have more than 300 million MAUs, but the proportion of those people who pay for subscriptions has remained a low single-digit percentage for years.
India Sony Music’s Kakar is of the opinion that putting “compelling content”, such as “some new releases” and “experiences such as artist interactions behind a paywall,” will be key to converting ad-supported consumers.
India (cont)

Services are already experimenting with a tiered payment structure, which the industry believes will be crucial for a price-sensitive market like India’s. Three pillars: ad-free, HD quality and unlimited downloads, is an example
India (cont)

That much of film-crazy India prefers to “watch music” as opposed to “listen to it” is well documented not only in the massive viewership of YouTube but also that of the recently banned TikTok, for which India was the biggest market.
Indonesia:

A population around 80% the size of the USA and a music industry that is smaller, in revenue terms, than that of New Zealand

but it has only 104.6m internet users and 8.9m broadband subscriptions, reducing its capacity for digital music.
Indonesia (cont).

The majority of music listening online in Indonesia takes place on YouTube, which reflects the platform’s free nature, as well as its close connection to social media and the fact that music is seen as a visual art in Indonesia.
Indonesia (cont)

Beyond YouTube, Joox and Spotify vie for prominence.
Joox, a music streaming service owned by Tencent, is seen as a mass-market service, which is stronger in local music; Spotify, meanwhile, is considered more global, its playlists helping to give it an edge.
Also active in Indonesia are Apple Music - whose lack of free tier has apparently rather harmed take up - and Resso, the music streaming service launched in 2020 by TikTok owner ByteDance.
Given Indonesia’s vast size and cultural diversity (more than 700 languages), it is no surprise that there is an incredible variety of local music, much of which has little or no connection to the global music business.
The strength of local music in Indonesia is reflected in the fact
that many of the top Spotify playlists are local. “In some Asian markets the big global playlist tend to dominate. That’s not the case in Indonesia,”
Indonesia (cont)

“Western pop is still big in in Indonesia. When you look a lot of the biggest artists are there, like Justin Bieber and Ariana Grande.” The exception to this is hip hop, which has struggled to get a foothold in Southeast Asia as a whole”
Last one on Indonesia:

Average annual music revenue is only $0.20 per capita, the potential benefits are vast.
Japan:

THE WORLD’S LARGEST PHYSICAL MUSIC MARKET (physical music market accounted for 70% of all recorded music)

Subscription audio streaming revenues grew by 25% year-on-year while ad-supported audio streaming was up 56%
Japan (cont)

“many big artists in Japan started to license their sound recording repertoire to streaming services in 2020. The number of popular tracks available on streaming services has been increasing and changes are making streaming services more attractive for subscribers”
Japan (cont)

“people had to stay home much longer than usual, could not go to CD shops and karaoke bars due to temporary closure and could not go to live concerts and events. Such combined factors pushed music fans to enjoy music by streaming services more than ever.”
Singapore:

Singapore’s digital music business is small but – relatively – thriving, with a large number of streaming services, a strong tech scene and a high conversion rate from free to premium streaming.
Singapore (cont.)

Spotify is generally considered to be the market leader, with Spotify Asia’s then-MD Sunita Kaur claiming in May 2017 that one in every two Singaporeans were Spotify users.
Singapore:
UMG’s decision to open a Singaporean office has probably more to do with the country’s status as a tech hub than
its musical gifts. UMG said that “being in Singapore puts UMG closer to our partners and alongside many of the world’s biggest brands and companies”
South Korea:

Some reports claiming that physical music sales actually increased in 2020.

K-Pop fans are still devoted to the physical product, but they’ve also become passionate streamers, hoping to contribute to their artists’ success stories by heavily consuming their music
South Korea (cont)

Spotify launched (w/o a free tier) in Feb 2021. Spotify said that the launch “presents a massive opportunity to further our mission of bringing new and quality content to more audiences, but also help local Korean artists tap into Spotify’s 320m listeners”
Spotify has, helped to spread Korean music globally, launching its first K-Pop flagship playlist, K-Pop Daebak, in 2014, followed by a dedicated K-Pop hub. But they will face a stiff battle in a South Korean streaming market where local DSPs are so well established
South Korea:

Some local observers believe that Spotify’s South Korean service needs to improve its range of local music. (iirc they launched without one of the important local labels who then came onboard; cc @TSOH_Investing )
Egypt:
Anghami #1 service in the area, Deezer has the advantage of the Rotana catalogue - in a country where majority of people listen to local music - Spotify, launched in November 2018, has been using curated local playlists and promotional muscle to build its market share
Israel:

Both Spotify and Apple consider Israel to be an over-performing territory in terms of subscribers per population. In just two years, Spotify became the number one music service in Israel in users and traffic and there has been a steady growth since the launch.”
Israel (cont)
When Spotify launched everybody was waiting for it. In Western society, brands are very important and people are willing to pay for them, so Spotify was much like McDonald’s – everybody wants to take a bite.”

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