Music
Industry Profile
Overview of the Music Industry
The music industry encompasses makers, sellers, promoters and distributors of music. Including the companies and independent artists that create and organise live concerts and shows, audio and video recordings, compositions and sheet music, and the organisations and associations that aid and represent music creators.
The music industry consists of many moving parts. The most visible components include writing, recording, and performing music by artists, singers, instrumentalists, orchestras, and songwriters. However, the majority of the industry involves many parts.
The music industry consists of many moving parts. The most visible components include writing, recording, and performing music by artists, singers, instrumentalists, orchestras, and songwriters. However, the majority of the industry involves many parts.
Segments of the music industry include:
Record Labels
Record labels are companies involved in marketing recorded music and related videos. Their functions include new artist recruitment and development (A&R, artist and repertoire), music publishing, and copyright enforcement.
Marketing is one of their most crucial functions. They make money from public awareness of their brands and associated talents. Universal Music Group, Sony Music, and Warner Music Group are the biggest record labels globally.
Music Distribution
Music Distribution is simply the process of getting music to the audience/listeners. Before the digital music era, pre-2000s, the primary function of music distributors was to get vinyl and, subsequently, CDs to the music stores. However, digital music distribution is now the primary form of music distribution. Nevertheless, music distribution still involves: Distributing Releases to DSPs, Royalties Allocation, Distribution Strategy and Trade Marketing.
Streaming
The most significant change in the music industry in recent years is streaming. Today, millions of people can play music on their devices and even share it with others.
Steaming has changed the business of the music industry. Today, streaming services are constantly trying to expand their user base, develop their product, and grow revenues. Additionally, they are trying to find a sustainable long-term business model. The most popular streaming platforms include Spotify Music, Apple Music, Amazon Music, YouTube Music etc.
Radio
Before the rise of streaming services, radio was the primary music discovery medium. Despite this, it is still a prominent promotional channel for music and remains integral to the music industry.
Live and Touring
Live music is still the music industry’s cash cow despite the rise of digital streaming platforms. Many artists begin a touring cycle, especially after releasing a new album. Artists and Managers, Booking Agents, Promoters, Tour Managers and Technicians, Festivals and Venues, Label and Publisher work together to put together Live shows, concerts and tours.
Licensing and Sync
Music is an essential art form in other creative industries like film and video games. Brands from Luxury to FMCG make sponsorships deals with musicians. Using music in these external industries is managed by the licensing business. Licensing can be a significant promotional opportunity for the artist, more than just a revenue stream.
Artist Management
Managers use their in-depth knowledge of the entire industry to create long-term global strategies and help the artists make critical business decisions. Furthermore, managers coordinate all of the professionals working on the artist’s career and manage the day to day affairs of a musician. The manager is the backbone of any artist’s career.
Music Publishing
Publishing is the oldest vertical of the music business. Music publishing involves promoting and monetising musical compositions. Music publishers ensure that songwriters receive royalties for their compositions and work to generate opportunities for those compositions to be performed and reproduced. How music publishers recover royalties varies across different copyright legislation worldwide.
Legal
The music business has its own rules and regulations, facilitating relationships where the law is not explicit. In addition, local laws differ from country to country. As a result, the Music Industry (one of the most globally connected industries) is governed by a disconnected system of contracts and legislation. As a result, a basic understanding of music law is essential for most music professionals.
Global View
According to the International Federation of the Phonographic Industry (IFPI) 2022 report, recorded music revenues reached US$25.9 billion, an increase of 18.5% in 2020 and the highest revenue level this millennium. It is an increased growth rate from 2020 (+7.2%). Revenue rose in streaming, physical formats, performance rights and synchronisation. Each of the world’s top 10 markets posted gains: USA, Japan, UK, Germany, France, China, South Korea, Canada, Australia and Italy.
According to the IFPI report, paid subscription streaming was a vital driver of the overall growth. It accounted for 65.0% of recorded music revenues, up from a 61.9% share in 2020. The report put the number of paid subscription accounts at $523M. This growth is due to record companies investing and developing music markets worldwide, supporting local artists and genres and connecting them with a global audience. In addition, record labels are innovating how fans can engage with music.
Africa
According to the 2022 IFPI report, the Middle East and North Africa (MENA) were the fastest-growing regions in 2021. It grew its revenue by 35.0% Streaming increased to 95.3% share of the market as overall revenues grew to US$89.5 million. The overall revenues grew to US$89.5 million as streaming increased to 95.3% market share.
According to Statista, revenue in the Music Streaming segment should reach US$297.00m in 2022. Furthermore, revenue should show an annual growth rate (CAGR 2022-2026) of 13.00%, resulting in a projected market share of US$484.20m by 2026.
UNIVERSAL Music Group (UMG), Warner Music Group (WMG) and Sony Music Entertainment have solidified their presence on the continent in recent years. In addition, some international private investment firms have invested in local operations and artists.
The growth in market share is due to international and regional music-streaming platforms, from Spotify, Apple Music, Deezer and YouTube Music to Audiomack, Boomplay and MTN Music Time (formerly Simfy).
Afrobeats and Amapiano are the current most popular exports from Africa. Nigeria and South Africa are the most prominent music industry markets, with many artists crossed over to global acclaim.
Ghana
The Ghana Statistical Service does not capture the annual data on the music history in its yearly reports. However, the project director of the Ghana Association of Phonographic industries, Mr Francis Twum Mensah, in an interview with Adom News in 2011, stated that the music industry provided over 100,000 direct and indirect jobs and an estimated 300 million US Dollars plus in taxes to the GDP every year. In the same year, the music industry received a 2 million Ghana Cedis budget from the Government of Ghana. However, according to Neliti reports, It was revealed that the extent of royalty payment law enforced in Ghana is minimal. The Ghana music right organisation is the body licensed by the government for collecting and distributing royalties.
Ghana pioneered afro-pop and had a thriving local music industry. However, by the mid-seventies, the country’s record business declined with the general economy. Record production went down to one-quarter of its former total. Several musicians and bands went abroad to record and never returned.
According to Statista, Ghana’s revenue in the Music Streaming segment is projected to reach US$1.22m in 2022. Furthermore, revenue is expected to show an annual growth rate (CAGR 2022-2027) of 9.18%, resulting in a projected market volume of US$1.90m by 2027.
Kenya
According to the World Bank, the Kenyan music industry was valued at about Sh320 billion in 2021. The Music Copyright Society of Kenya reports Kenya’s entertainment to be worth Sh200 billion in 2019. According to a PriceWaterhouseCoopers report, the local entertainment industry (including the Music Industry) made more than Sh189 billion in revenue.
Revenue in the Digital Music segment is projected to reach US$10.99m in 2022. According to Statista, revenue is expected to show an annual growth rate (CAGR 2022-2027) of 5.10%, resulting in a projected market volume of US$14.09m by 2027. The largest segment is Music Streaming, with a market volume of US$9.85m in 2022.
Nigeria
According to trade.gov, the Nigerian music industry revenue was estimated to rise to $73 million by 13.4% in 2021. By 2021, the local industry employed about a million people and generated over $8 billion for the economy. According to an IMF report, the industry is projected to generate an estimated $10.8 billion by 2023. This will account for 1.4% of GDP.
The music sector has grown significantly. The increased numbers of new production studios and artists have enabled a more vibrant and self-sustaining industry. In addition, global companies investing in the industry have resulted in the production of world-class quality music.
There was an increase in music streaming subscriptions (154.3 million as of December 2020) and digital song sales due to the Covid-19 pandemic. The entry of streaming platforms such as Spotify also moves the Nigerian market into a global market.
South Africa
According to the local trade association, the Recording Industry of South Africa (RISA), trade revenue was up 3% in 2020, to ZAR455. 6m ($27.9m) from ZAR442. 5m in 2019
The RISA industry report for 2020 showed that the music industry in South Africa earned R456 million in total. Of this, R368 million was earned by international record labels, and local music companies earned R88 million. Therefore, the market share of local music has dwindled from 50% ten years ago to less than 20%, and it has decreased by 4.5% from 2019 to 2020.
The administrators of South Africa’s collection societies impose some of the highest fees on the planet. As with PPL, one of the major collecting agencies in the world, the global average for administration is almost 7%. The Industry is faced with several challenges – misappropriation of funds by regulatory and licensing bodies, lack of support and unpaid royalties to artists, etc.
Subscription-based streaming services
Music streaming services offer on-demand access to music on digital devices—smartphones and computers. The most popular ones include Spotify, Apple Music, Tidal, Amazon Music and YouTube Music; they all have different features, plans, and price points.Cover features by emerging artists for online distribution for visibility
A cover song is a new recording of someone else’s song. Today, emerging artists gain visibility by releasing and distributing their covers of popular songs, adding their flair and style.Crossover between music and gaming, with gaming becoming a revenue stream
As gaming becomes a revenue stream for many people, game developers are sourcing new music, sometimes up to a year before release. Many people are discovering new music in games, a trend expected to continue.Growth in independent labels leveraging the internet
Independent labels are independently funded record labels not connected to one of the big three major labels: Warner, Sony and Universal.
The rise in streaming services and social media to promote and listen to music has helped many independent labels and artists succeed in the music industry’s sometimes predatory environment.Bundling of music services by Tech Giants such as Amazon, Apple and Google
The bundling of music streaming services with other entertainment services like video and videogames is another way investors see potential growth and expansion within the industry.
Bundling services reduce marketing and admin costs and increase margins. Examples include Apple Music Student + Apple TV, Spotify Premium Student + Hulu + Showtime, etc.
- TikTok Music Marketing
TikTok has recently become a powerful marketing platform for musicians, from signed musicians to independent musicians. Dance challenges and layering videos over memes are ways to make the music go viral. Emerging musicians also post covers and duets to become more visible.
Some research areas include;
- Music Technology; computer music composition, sonic art, live-sound technologies, software programming, studio recording and production, software development and spatial audio technologies.
- Music and Culture; evolution of music across time, the effect of music on popular culture and society, the study of the relationship of music to the individual, social, cultural, political, or economic experiences
- Psychology of Music; Interpretation and understanding musical sounds, musical behaviours, and the effects of music.
- West African pop music; the evolution of African music with pop genre, hip-hop, Afrobeats, Amanpiano etc.
SDG 8
This focuses on decent work and economic growth, where creativity and innovation are indispensable. In addition, the production and distribution of cultural goods and services support the economies. Traditional products, like artist merchandise, digital technologies, concerts, live shows, and festivals, exemplify how the music industry drives the economy.
SDG 9
With inclusive and sustainable industrialisation, the music industry as a creative industry generates employment and income.
SDG 17
Partnerships for the goal.
Music is a great connector; it provides an excellent platform for promoting all the SDGs.
Several challenges provide opportunities for innovation in the industry. They include;
Weak IP protection
Intellectual property and copyright laws are not enforced in developing music markets. As a result, many musicians see their work used in other creative industries without proper compensation. This is a significant area for innovation.
Poor royalty payment
Musical royalty is the amount paid to an artist for performing or reproducing their musical work by another for business reasons.
The Copy Right Act enforcement in Nigeria has remained a challenge in Nigeria. As a result, the Copyright Society of Nigeria (COSON) was formed in 2009 to work around this. COSON collects royalties on the members’ behalf.
The dominance of distribution companies in revenue sharing
Sony, Universal and Warner heavily dominate the industry. They own many sub-labels and almost two-thirds of the revenue generated annually. This has led to the rise of independent labels that championed indie artists to fame without the backing of the big three. Despite this and the rise of streaming platforms, distribution companies still take the more significant portion of revenue.
High level of Government Censorship
Music, in Nigeria, has been used as a tool for social commentary, sometimes against the government. However, artists who used their music to convey socio-political messages are often censored and punished despite legislation surrounding freedom of expression.
Substance abuse and addiction
The music industry is linked with numerous scandals involving substance abuse, even to the point of death induced by overdose. Musicians abuse drugs to decrease performance anxiety, increase creativity, and combat boredom when waiting around to perform. Additionally, some use it to relax, unwind, and socialise after a performance.
In addition to performance enhancement and surrounding pressure from peers, drug and alcohol addiction induce several psychological and mental health issues.
The high barrier of entry for new artists to go mainstream
Today, musicians have a higher barrier to entry. Streaming is relatively not financially rewarding. Live shows are a more considerable revenue stream and only favour more famous artists. However, the internet has made it more accessible to more artists, even though it requires effort to breakthrough.
Music subscription streaming
More streaming services have risen with the digital evolution and more internet penetration. For a price, monthly or annually, a person can stream music on their smart devices or computers. The most popular streaming services are Spotify, Apple Music, Tidal, Amazon Music Unlimited and YouTube Music.
AI-generated music and recommendations
Generating and composing music are applications of AI in music right now. Additionally, streaming services use AI to recommend music to a listener accurately. As such, music listening has become a more personalised experience. Furthermore, musicians, labels, producers, publishers, and playlists curators use AI to analyse and edit music.
Remote collaboration among creatives
The COVID-19 induced lockdown has made remote collaboration a thing. Nevertheless, many music collaborations happened with the use of digital technologies. For example, Burna Boy remotely completed his Twice as Tall album during the pandemic with his collaborators.
The intersection of music and virtual reality
Live Virtual reality shows became more popular during the lockdown. By wearing a device, an audience can immerse themselves into a music concert or live performance from the comfort of their homes.
More monetisation options for independent artists through platforms like Patreon
Membership platforms like Patreon allow musicians to earn a monthly income. Fans of a musician can pay a monthly subscription fee for access to rewards and perks.
Measurement of reach and engagement
Measuring an artist’s reach and engagement is not only to create marketing strategies. It also positions an artist for brand engagement, leading to more revenue flow.
The music industry is mainly a creative industry run by visible creative artists. However, several business and administrative functions are run by people from diverse industries run. Also, because it is a creative industry, it overlaps with other creative industries like film, television, and video games.
There are several careers or roles in the music industry. They include:
Songwriters, Composers, Singers, Musicians, Conductor, Bandleaders, Music publishers, Music producers, Music Supervisors, Recording studio engineers, and sound engineers. In addition, Booking agents, Promoters, Talent managers, Artists and Repertoire managers, Business managers, Entertainment lawyers, Music Journalists, Music Critics, DJs, Music Educators and teachers and Musical instrument manufacturers.
According to glassdoor.com, the highest paying jobs in the music industry includes; Audio engineer, Singer, Music director, Music teacher, Music therapist, Artist Manager, Music professor, Music producer, Choreographer, and Band manager.
Creativity and Critical Thinking
Generating ideas in music involves creativity, from songwriting to performing. As a result, the industry relies heavily on creativity as a form of expression (mixing and blending melodies and bending and fusing genres) and critical thinking to ensure quality control.Communication & Persuasion
An artist should be able to convey expressions and emotions through music. But, more importantly, an artist should be able to communicate with their team; managers, producers, agents etc.Networking & Teamwork
Music and musicians rely heavily on networking and teamwork. Any successful artist has a team of people to ensure continual success, from producers to A&R, record labels, promoters, distributors, etc.Continual Learning & Adaptation
A musician has to adapt to changing cultures, platforms and styles constantly. For example, Afrobeats and Amapiano are the current most popular genres. As a result, many musicians are showcasing their ability by playing within the genres while still maintaining individual styles.Self Awareness & Management
The music industry is high-pressure, and it requires an ability to keep one’s head straight. Unfortunately, many artists have failed and fallen to infamy due to a lack of self-awareness and management.Digital Skills
Due to the rise of streaming platforms and, consequently, independent artists, content creation is an essential digital skill. In addition, many indie artists do self-promotion and marketing using social media.
Like other creative industries, the music industry is broad and encompasses other sectors. As a result, it is open to various professions and degrees.
The industries require no formal degree and no entry-level academic barrier. However, specific courses are available in schools for people who desire academic qualifications. they include
According to Prospects UK, a Bachelor of Arts (BA) or a Bachelor of Music (BMus) in music has no clear distinction. Therefore, anyone interested in a formal degree might get a bachelor’s degree in the following:
- composition, music business, music journalism, music management, music production, music technology, musical theatre, songwriting, sound engineering, digital music, live events production, popular music performance, media and communication (music industries), sound technology, stage management.
Anyone interested in a post-graduate degree might study for a Master of Arts degree in music, where one can specialise in a particular area of music, including:
- composition, composition of music for film and television, music education, music for the moving image, music production, music psychology, music and sonic media, musical theatre, performance, history of art and history of music
Despite providing many career opportunities beyond being a musician, breaking into the music industry can be challenging. Most of the jobs in the industry are rarely formally advertised, therefore, making reaching out directly to people within the industry or your connections to the industry a better bet. But, again, it’s an industry that requires actively networking.
Social media today provides a global platform to showcase your skills. It can give you reach to players in the industry who can see your work. Are you a songwriter? Write songs you or a friend can sing. Are you a promoter? Promote other musicians online. Are you a talent manager? Share tips for music talents via a blog. Are you a beatmaker? Share your beats on Soundcloud.
In addition to building your confidence and a fanbase, showcasing yourself provides you with an advantage to confidently apply for internships and job opportunities rare in the industry. For roles in the industry, be flexible to get work opportunities that guarantee you first a foot in the door.
Work experience and internships are essential to stand out from the crowd and demonstrate your passion and dedication to employers,
Wherever possible, try to gain relevant experience. For example, volunteer or do an internship in a recording studio if you are an aspiring music producer or recording engineer. Intern at a record label if you aim to get into A&R, artist management or marketing and PR. However, keep in mind that any music-related experience will be helpful.
The music industry is one of glamour and a theatre of passions. It is a highly competitive industry. It involves socialising, events, parties and shows of luxury. Yet, behind the scenes, there are several executives punching numbers and doing the deals to guarantee profits from content and intellectual property rights. As a result, the creative industry provides an opportunity to work across several job functions. In addition, the industry is a good fit for individuals with an outgoing personality that can continually adapt to trends.
Formal and informal meetings with accomplished and aspiring stars are typical in the workday of executives within the industry. In addition, managing talents, negotiating content rights and sponsorships, and giving creative directions are job functions of music industry executives.
It is no news that most artists do not make money, and long term record deals are now uncommon. Today the industry demands a finished product, and many new young stars, sometimes even teenagers, struggle to get discovered. Social media has played a role in the discovery of new stars. However, for many people, it becomes a struggle to maintain relevance.
Though reports of mega financial deals and lucky breaks make headlines in the industry, the financial rewards for creatives and professionals may take years to come. Nevertheless, several artists have had their lives changed from a hit song and have ridden the popularity wave to a steady career in the industry. Although it is not uncommon for several to work on zero to low wages to pursue their passion, many examples show that success is achievable.
International
International Music Council (IMC),
International Confederation of Societies of Authors and Composers (ICSAC),
Global Copyright Office.
Ghana
Ghana Music Rights Organisation, Musician Union Of Ghana, Classical Music Association of Ghana
Kenya
The Kenya Association of Music Producers, Music Industry Association of Kenya, Kenya Association of Music Producers, Music Copyright Society of Kenya
Nigeria
Artiste Managers Association in Nigeria (AMAN), Recording Industry of South Africa (RiSA), Broadcast Film Critics Association, International Documentary Association, Society for Cinema & Media Studies, Copyright Society of Nigeria (COSON), Performing Musicians Association of Nigeria (PMAN), Incorporated Society of Musicians, Musical Copyright Society Nigeria (MCSN)
South Africa
Recording Industry of South Africa (RISA), Southern African Music Rights Organisation (SAMRO), and South African Music Performance Rights Association (SAMPRA).
International
Angelique Kidjo, Brenda Fasi , Audu Maikori , Cobhams Asuquo
Ghana
StoneBwoy, Sarkodie, R2Bees, Gyakie, Black Sherif, King Promise, Kidi, Kwame Eugene, Niiella, Becca
Kenya
Bien Amie Baraza, Nikita Kering, Shanah Manjeru, Karun, Samidoh
Nigeria
WizKid, Fela Anikulapo
South Africa
Brenda Fassie, Kgaogelo Moagi (Master KG), Kiernan Jarryd Forbes (AKA), Kabza De Small, Ndivhuwo Elaine Mukheli (Elaine), Mafikizolo, Nomcebo Zikode.
International
UNESCO
Ghana
Ministry of Tourism, Arts and Culture, Ghana Copyright Office, Music Council of Ghana
Kenya
The Permanent Presidential Music Commission, The Ministry of Sports, Culture and Heritage
Nigeria
Nigeria Broadcasting Commission (NBC), Nigerian Copyright Commission (NCC)
South Africa
South African Music Industry Council (SAMIC), Department of Arts and Culture.
Global Organisations
Sony Music Entertainment, Universal Music Publishing Group, Warner Music Group, Island Records, BMG Rights Management, ABC-Paramount Records, Virgin Records, Atlantic Records, Def Jam Recordings, Gracenote, Trace TV, MTV Base (Viacom CBS), Telenor, Soundcloud, Ticketmaster, PRS for Music Limited
Africa
Trace Africa, Trassion, EaseNet, Boomplay, The Vth Season, Lusafrica, Gallo Records, Wasafi Classic Baby, Kalawa Jazmee Records, Channel O (Multichoice), MTV Base Africa (Viacom CBS), SoundCity (CMA Group).
Ghana
Lynx Entertainment, Highly Spiritual Music, Sarkcess Music, MicBurnerz Music, Zylofon Music, Burniton Music Group, GroundUp, Living Life Records, BBnz Live, Shatta Movement Record Label, RuffTown Records, Black Avenue Muzik, Legacy Life Entertainment, Arab Money Gang Business Music Label, NKZ Music, Skillions Records, Bullhaus Entertainment, Empire Entertainment, Native Park Records, Arizoner Music Group, Media Excel Productions, Koded Studio, MIDO Productions, LAT Studio, Q. Lex Entertainment, Flangar
Kenya
Alterr Productions Nakuru County, Still Alive Records, Calif Records, Ace Music & Video Recording Studio, Cosmo Music School, Elite Focus Entertainment Group, Decimal Studios, Big Paper Inc., Goopa DJs, Bwenieve, Main Switch Records, Hope Recording Studio, Kassanga Music Centre Ltd, Princecam Media, Janeson Recordings, Pacho Entertainment, Creamvision, Jomino, InkredibadMusic School, Chandanara Records, Equator Records, Ngemu Gospel Sounds, Hitscore Records, AI Records, Sub Sahara Ltd.
Nigeria
The Temple Management Company, Mavin Records, YBNL Nation, Star Boy Entertainment, Chocolate City, Spaceship Entertainment, Made Men Music Group, PentHauze Music, Kennis Music, 960 Music, The Aristokrat Group, & Empire Mates Entertainment, Rhythm FM (Silverbird Group), Capital Dream Pictures, Capital Hill Records.
Several top consulting and law firms also have practices focused on the media & entertainment industry.
South Africa
David Gresham Record Company (Pty) Ltd, Universal Music Publishing (Pty) Ltd, KvN Publishing (Pty) Ltd, Sony Music Entertainment Africa (Pty) Ltd, Sheer Publishing (Pty) Ltd, SM Publishing South Africa (Pty) Ltd, Arena Holdings (Pty) Ltd, Red Igloo Music Publishing CC, Dojam Productions CC, Electromode (Pty) Ltd, Warner Music South Africa (Pty) Ltd, Content Connect Africa (Pty) Ltd, Universal Music (Pty) Ltd, Sony Music Entertainment, Afrotainment, Ambitiouz Entertainment, Gallo Record, Kalawa Jazmee Records.
Publications
Rolling Stone
Variety
Billboard
Entertainment
Hip Hop World Magazine
Events
Midem,
Grammy Awards,
MTV Award,
Headies Award,
ACCES Music Conference,
The Music Imbizo (South Africa),
Africa Rising Music Conference
BBC Introducing Live,
DOADOA
The Atlantic Music Expo
All Africa Music Awards (AFRIMA)
Movies
Bohemian Rhapsody (2018),
Get on Up (2014), Ray (2004),
“Straight Outta Compton” (2015),
Almost Famous (2000),
Industreet (2017)
Ayinla (2021)
Podcasts
The Business Side of Music
The Marketing Musician Podcast
And the Writer Is…
Creative Juice
DIY Musician Podcast
Song Exploder
Afrobeats Intelligence
African Album Review
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