NEW GLOBAL MARKET SHARE ANALYSIS OF THE INDEPENDENT MUSIC SECTOR
London, 23rd October 2017
WINTEL 2017 ANNOUNCES NEW GLOBAL MARKET SHARE ANALYSIS OF THE INDEPENDENT MUSIC SECTOR
Independent record labels now represent 38.4% of global recorded music market share in 2016 with global revenues in excess of $6bn
London, October 23rd 2017 –. WINTEL 2017 is the second report produced for Worldwide Independent Network (WIN), mapping the global market share of the independent sector at copyright, rather than distribution level.
This new report was commissioned by WIN to analyze the global economic and cultural impact of the independent music sector. It is authored by Mark Mulligan of MIDiA Research and edited by Dave Roberts of MBW.
This survey was completed by 660 respondents including labels and distributors from 26 countries and the results represent the most comprehensive assessment of the global independent record label sector ever compiled.
It is important to emphasize that this report once again focusses on the criterion of value based on rights ownership rather than distribution when analyzing market share.
This is a crucial distinction because where independent companies use major labels or companies owned by major labels in various territories around the world to distribute their music, those major labels include the value of revenues derived from the distribution of independently owned rights into the label’s assessment of the majors’ own market share.
The claiming of market share by these international corporations, which currently amounts to $1.2bn of revenue that should be attributed to the independent sector, distorts the true picture of market value.
WINTEL’s analysis by reference to rights ownership therefore provides a much more accurate overview of the marketplace.
It is also important because market share is used by the leading digital music companies such as Apple, Google and Spotify in negotiations with the independent sector and often determines the levels of remuneration paid by these companies to music right holders.
Key findings from this research include the fact that, based on rights ownership, the global market share of independent record labels has increased since 2015 by 0.9% to 38.4%, representing global revenues of $6billion in 2016. This is an increase of 6.9% on the previous 12 months.
Although global independent label market share increased by 0.9% to 38.4%, changes at country level were as diverse as the market share picture itself.
The US saw the largest single swing in favour of independents, increasing 1.7% to 37.3%. South Korean independents further increased their grip on the Korean market, with strong results from leading independents resulting in total market share growth of 0.6% up to 89.1%.
The independent share declined slightly in Japan, down 0.3% to 63.3%, with a number of leading local companies registering significant revenue losses in 2016.
Many European markets, including key territories such as the UK and Germany, saw independent market share fall slightly, despite overall revenue growth.
The report makes clear that digital music, and streaming in particular, continues to create exciting opportunities for independent labels and that in virtually every country, independent labels continue to record higher market share in streaming than they do in physical formats.
It is entirely down to streaming that the global recorded music market enjoyed its second consecutive year of growth (5.9%) in 2016. Prior to 2015 it had endured 15 years of decline.
Measured in isolation, streaming grew 60.4% in 2016. It now accounts for 59% of all digital revenues, whilst digital as a whole now accounts for 50% of the total market.
Independent label streaming revenues grew by 80.4% in 2016, reaching $2.1 billion, up from $1.2 billion in 2015. This growth was slightly greater than the 78% by which the entire market grew, so independent label market share of streaming revenues increased by 0.6%, up from 39.4% to 40% over the same period.
The report demonstrates another impressive year for independents worldwide, and also describes the continuing importance of the sector to local culture and to the extended employment opportunities in the freelance sector serving the community.
Martin Mills, Founder of the Beggars Group and Vice President of WIN commented: “It speaks volumes for the tenacity, passion and entrepreneurship of independent labels, and the public’s desire for musical diversity, that even in these times of global dominance by major corporations, almost 4 out of every 10 dollars spent on music goes to the independent sector.“
Kees Van Weijen, President of IMPALA commented, “The united indie community, its labels and artists show the diversity of its products in all genres of music world wide as presented in this Wintel report”
Helen Smith, Executive Chair of IMPALA: “Statistics are vital. They punctuate the storyboard for the independent sector.”
Alison Wenham, CEO of WIN said, “The WINTEL 2017 report tells the story of another strong year for the independent sector. It has seen solid growth overall and an astonishing increase in streaming revenues. Both are trends we are confident will continue. It is important when making sense of the global market for independent music that we continue to use ownership rather than distribution as the method of calculation. The claiming of market share through distribution by major labels distorts the true value of the independent market and creates a false picture of the amazing growth and vitality of our sector.”
Richard James Burgess Ph.D., CEO of A2IM and Vice President of WIN stated: “It is truly gratifying to see both U.S. and global independent market share increase again. We must continue to strive for a level playing field where the best releases rise to the top and where the digital services that respect copyright do not suffer unfair competition from those that co-opt our rights. Even as we celebrate we must remain vigilant. We are fighting our way out of a deep hole created by copyright abusers and we have a long climb to get revenues for creators and producers back to where they should be.”
WINTEL is available in print and online (here).
For further information:
Tel: + 44 (0) 7939 133050
Unique in the history of the global music industry, WIN is a representative organization exclusively for the worldwide independent label community. It was founded in 2006 in response to business, creative and market access issues faced by the independent sector everywhere.
WIN’s membership stretches across every continent, with trade associations in all the well-developed music markets taking a particularly active role. WIN’s priorities are set by the global membership, and with IMPALA, included the creation of Merlin, the world’s first independent global digital rights licensing agency.
For independent music companies and their national trade associations worldwide, WIN is a collective voice and platform. When appropriate it acts as an advocate, instigator and facilitator for its continually growing membership. WIN is also a focal point for collecting and sharing knowledge about the indie sector at national level.
IMPALA was established in April 2000 to represent independent music companies. 99% of Europe’s music companies are SMEs. Known as the “independents”, they are world leaders in terms of innovation and discovering new music and artists – they produce more than 80% of all new releases and account for 80% of the sector’s jobs (for more information, see the features of independents). IMPALA’s mission is to grow the independent music sector, return more value to artists, promote cultural diversity and entrepreneurship, improve political access and modernise perceptions of the music sector. See the organisation’s key achievements in IMPALA’s first 15 years in milestones. IMPALA has its own award schemes which highlight the artistic contribution of independent music. IMPALA award winning artists include Agnes Obel who was voted winner of the last Album of the Year Award, Caribou, José Gonzáles, Guadalupe Plata, The xx, Armin van Buuren, Caro Emerald, Adele, M83, Mogwai, Metronomy, Arctic Monkeys, Justice, Soap & Skin, The White Stripes, Royksopp and Andrea Bocelli. IMPALA’s Digital Action Plan published in 2015 is a key reference for growing the digital market.
IMPALA – Independent Music Companies Association
Rue des Deux Eglises 37-39, 1000, Brussels, BELGIUM
+32 2 503 31 38