Emerging markets could be about to change the business of superstars



The traditional recorded music business consisted of selling units, which naturally meant that the most important markets were not the most populous but the wealthiest. Throughout the end of the 20e century, this created a “global” market dominated by North America, Europe and a few others. This is why (among other political reasons) Japan has become the largest Asian music market, rather than China.

Today’s music business is different. Streaming (especially through ad-supported offerings and bundles) can monetize large-scale audiences in markets with low GDP per capita. Suddenly population size matters and emerging markets are becoming the largest music audience in the world. The opportunity in emerging markets has the Western music and investment industries salivating, but there’s another layer many have missed: This shift will change the way Western record companies operate, including reviving question the very notion of global superstars with which they trade.

The traditional domination of the Anglo repertoire

Prosperity leads to prosperity. Where music sales have done well, music companies have done well. The music business is doing better in the United States, as well as to a lesser extent in other major English-speaking markets. These countries have also benefited from the fact that English is the most exportable language for music. In the early 2000s (and outside the United States), in the top 10 music markets, the national repertoire represented more than half of sales in Japan and France alone. The Anglo repertoire dominated the world music market and extended its reach. Most countries around the world were seeing their national repertoire shares drop year after year as we entered the new millennium. This of course meant less money being pumped back into local stages, which meant more opportunities for international superstars to dominate. It was a cultural vicious cycle. And then the hacking happened.

A decade of savage piracy has hit the national repertoire hardest in many countries. For example, in Spain the best way to keep track of national artists was the painting “the manta”. Literally “the cover,” referring to the guys unfolding a cover around the corner full of counterfeit CDs. So many local music scenes in emerging low-income markets have essentially remained mostly organic and local for a decade. Then came streaming, and suddenly artists can find their audience in ways previously unimaginable. In geographically large countries like India and Brazil, visiting the country was not a realistic option for most artists, so streaming allowed them to reach across their countries, and beyond, in one. instant.

Streaming, a cultural catalyst for local scenes

The cultural impact of streaming on local stages was in fact first seen on a large scale in Europe, with the rapid emergence of German, Dutch and French rap scenes that found massive national popularity but grew. rarely export. In the old model, lack of “exportability” meant no recording contract, which meant no local scene. Streaming changed that. Another important milestone was the rise of Latin American music, especially reggaeton. Although some Latin American artists have made their way onto the world stage, the biggest impact has been the rise of national and regional superstars. This is the future we are entering.

Expecting emerging markets to appropriate the Anglo repertoire simply because they now not only broadcast hints of cultural imperialism, it also misses out on the underlying fundamentals of changing music scenes and music. the consumption. The constant boom in the Anglo repertoire until the early 2000s was replaced by a boom in local and regional music. Globalism is replaced by internationalism, homogeneity by diversity. All of this means that Anglo-world superstars will feel the pinch. The superstar industry was already facing the headwinds of fandom fragmentation, so emerging markets are an accelerator of a pre-existing trend, as well as multipliers such as growth in the number of artists, releases and referrals. personalized.

Building from the inside, not from the outside

However, none of this necessarily means that Western labels cannot thrive in emerging markets. After all, they have the resources and expertise that decades of global success bring. They will need to change their mindset and move from finding export markets to places where they can create new, national talent-driven companies. A handful of joint ventures from Western majors in Asia and Africa suggest that the first steps are being taken, but to be successful, these strategies will need to be seen as the centerpiece of the directory strategy for emerging markets, and not as a component of support.

However, Western majors should not assume that they will be able to outperform local and regional labels. In Japan and South Korea, the Western majors are minority players, having failed to overthrow the dominant local “majors”. Interestingly, both countries are long-term exceptions to the dominance of the Anglo repertoire. Both are high per capita markets with large economies that can support thriving domestic music businesses. Moreover, the Anglo repertoire does not import as well in these markets (despite endless Western groups trying to “”Pause’ Japan), with an international repertoire stuck at around a quarter of sales in both markets at the turn of the millennium. Today, in the third decade of the millennium, it is South Korea that exports music to the world, from “Gangnam Style” to Black Pink and BTS. This shows that global superstars will still be a long-term feature of the music industry – albeit fewer Anglo-Saxon artists.

The perspectives will thus be defined by:

  • Fewer Anglo-World Superstars
  • An increase in non-English speaking superstars
  • The rise of regional superstars
  • The rise of local scenes and national artists

It is an exciting time for music culture across the world and we are quite possibly entering what will be the most culturally diverse era the global recorded music industry has ever seen.

If you’re interested in emerging market themes, keep an eye out for a free report MIDiA will release next week. Watch this place!


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