Digital music market in Africa

Posted on November 26, 2017 12:32 am

Digital music market in Africa is growing with Nigeria being Africa’s biggest digital music market, selling $50 million worth of music a year according to the most up-to date data your blogger has obtained. However, most Africans prefer to enjoy free music from file sharing sites or YouTube while surfing the internet, rather than buying songs. Unlike in the developed world where a certain percentage of the population are music buyers, African market has far fewer people willing to pay for music online by buying digital albums or subscribing to a streaming service.However, in contrast to the European or American or UK digital music market, the African market is relatively small. The regional revenue amounts to less than a tenth of the United States, it stood at $150 million compared to $4 billion in Uncle Sam. Nigeria has dominated the market in Africa, with about a 40 percent share in 2016, says the report. However, the report says, the opportunity in the region is significant though Africa accounts for only 1 percent of global digital music revenue. The report says the speed of change in the digital music market in Nigeria and South Africa has outpaced the rest of Africa as 76 percent of digital music revenue in the region which mostly comes from music streaming. This growth has been powered by the emergence of a generation of digital natives, improving connectivity, and more localized and personalized curation. Nigeria is followed by South Africa, Egypt, Morocco, Ghana, Tanzania and Kenya respectively. Only 1 percent of African will pay for music shows the data adding that a lot of music businesses focused on the 1 percent instead of catering to the 99 percent.Therefore, to win a greater market share, music streaming services must be affordable, report noted. Various music streaming sites in Nigeria includes subscription cost in data packages that prospective customers buy from mobile network operators. It appears to be a successful strategy for the music streaming service, which secured the industry US$16 million in investment in 2016.

Though Africa’s music market is way behind developed countries, the projections from the report is that Africa’s recorded music business will nearly triple over the next three years. It says it would likely to bring an annual income of US $130m in 2020.The data shows that digital music is now 35.4% of the African recorded music market, in comparison, the physical format like CDs, vinyl, cassettes dropped by 22% in 2016 and sold nearly 5 million units. However, digital’s expansion did not balance out the further decline of the physical formats. The value of Africa’s recorded music market is now $200 million, a drop of 14% from last year.Through 2016, the market shifted and a decline of 15% was recorded. In 2015, the Nigerian and South African music industry registered a 3% increase.On the other hand, streaming revenue doubled to $6.8 million and digital album sales rose 8% while total digital download revenue stayed steady with a tiny 1% rise. Revenue from subscription services was up 91%.The positive news was that 2016 saw record companies expanding their revenues through touring, merchandise, synchronization licensing and artist management, some labels showed individual growth with Nigeria, South Africa and Ghana leading.Report authors are optimistic about the way the industry has embraced opportunities in the digital sphere. One of the report authors told your blogger that the way that music is discovered and enjoyed by fans in Africa continues to evolve, and as the industry continues to transform itself, the sales trajectory will not always be a straight line. She added that around the countries in Africa like Nigeria that streaming services have gained momentum, strong market growth has followed. It is an exciting time, as African music fans are consuming more music than ever before with an ever-expanding range of options to access music whether it is streaming music, digital downloads or visiting the local record store.As African music industry continues to embrace the digital landscape, it is increasingly important that it creates the business and rights protection environment in place to support local artists and record labels, which make such a valuable contribution to Africa’s cultural identity and creative economy.

Contador Harrison