MUSIC IN
INDONESIA TODAY
Presented By : Gumilang
Ramadhan PT. Musica Studio’s
Physical Sales 1996
2010
2011
2012
2013 Until April
77 Millions
11 Millions
15 Millions
15 Millions
3 Millions
RBT Era
• September 2004 to October 2011, Indonesia manage to gather 25 Mio Subscribers across all telcos
Digital RBT Sales
RBT Subscriber
2005
2010
Current
5 Millions
25 Millions
5 Millions
Details 1996 2010 2012
1. Mobile Phone User 40 millions 180 millions 240 millions
2. Total Music Store/Chain +/- 400 +/- 300 +/- 200
3. Total Physical Distributor
26 26 18
4. Total Live Music (Tour) Top 10 Local & Int’l Artist
- More than 3000 gigs
More than 4000 gigs
5. Total Physical Bundling - +/- 4 millions +/- 9,5 millions
Details 2005 2010 2011 (until Oct)
2012
1. Total iTunes Indonesia Store
- - - Just started
2. Other Digital - - +/- 10 % of Total Market
+/- 10 % of Total Market
• Local Music : 80 % • Int’l Music : 20 %
International vs Local Repertoire
1. 360º Deal a. Artist Management b. Recording c. Publishing
Unique Market
2. Bundling a. Physical Bundling b. Digital Bundling
1. To Minimize Digital and Physical Piracy 2. To Panetrate a new Niche Market 3. To Panetrate New Bundling Partners 4. To Maximize ExisLng New Digital PlaMorms 5. Start to Collect ReproducLon Rights From Karaoke Lounge
(more than 1000 outlets with min 10 karaoke rooms) 6. We Need To Persue On Sound Recording Performing Rights
Law
Challenges
Thank You
India Music Update Mandar Thakur COO Times Music
• Industry consolida8on as players come together for common physical distribu8on networks
• Digital revenues contribute between 60% – 80% in most labels today (up from 50 % about 3 years ago)
• Sheer nature of top selling content like Bollywood Film music (already in a audio visual consump8on format – necessitates video plaLorms and their rise)
• Growth of smart devices: already 30% of all devices are internet enabled & growing at CAGR 34%-‐ which effec8vely means consump8on paUerns of music will change from IVR based to digital streaming and subscrip8on services
• iTunes launched in India in December 2012 at a price point of US 20-‐25 cents per song – lowest price point in the world
• Local streaming services Gaana, Dhingana and Saavn are seeing strong growth and à-‐la-‐carte download services are beginning to emerge. Youtube viewership gaining trac8on (aided by portable mobile devices) – Music is one of the largest drivers
4G/LTE to be launched in 2013 end (with expected adop8on of 4G users reaching 5 million by 2014). What this means is that all the dots in the Indian ecosystem to foster high speed streaming music/video consump8on are now in place namely: ü Smartphones (sub 30 US$); ü High speed LTE connec8vity (120,000 KM); ü Content availability with a very simple licensing structure; ü Major global music services present and entering; ü A high spending middle class
India – Music/Entertainment Landscape
India – Music/Entertainment Landscape
• Size of recorded music market in US$ – The Indian music industry is projected to achieve revenues of INR 1,160 Cr.(US$215mm)
in 2013, registering a growth of 9%+ over 2012. – In India, film music (both Bollywood and regional film music) con8nues to be the mainstay
of the music industry, contribu8ng approximately 70% (depending on topicality) of the industry’s revenues
– However, what is extremely important is -‐ with the emergence of digital streaming/subscripDon plaEorms and greater channels of music discovery, consumers are now being exposed to newer genres, leading to a growing demand for non-‐film music and consumpDon outside Telco dominated ‘walled gardens‘. These include a higher poten2al for Interna2onal music sales in India.
– IFPI-‐2013 report : India moved up to #14 on IFPI Music Sales ranking by country • Physical/digital split
– Physical: 30%; Digital: 70% • Domes8c/Interna8onal as % of respec8ve plaLorms:
– Physical: 5.5%, – Mobile -‐RBT primarily: 1.5%, – Digital -‐led by itunes: 25%+ (also includes subscripLon/ streaming, others)
New Film55%
Old Film30%
Non-‐Film & All Else15%
Mobile Music
New + Old Film66%
Devotional / Classical / Non Film22%
Intl7%
Regional5%
Physical Music
Bollywood60%
Non Film25%
Intl15%
Digital MusicCross Medium Genre-‐wise Breakup
US$ 1.1~1.8 (MVAS ARPU) – TRAI AR FY12 The rapid growth in smart
phone ownership, growing 3G access, launch of 4G and rising household broadband adop8on, are opening doors to new business models.
Major legi8mate services (web-‐based): iTunes, Nokia Music Ovi, Gaana, Saavn, Dhingana
List in order of Revenue generated: • Telco based music subscrip8on services (RBT subscrip8ons and mobile radio) • Music streaming & subscrip8on services viz. Saavn, Dhingana, Gaana etc. • Video streaming/subscrip8on services – YouTube, DailyMo8on, BoxTV • A la carte downloads (iTunes, Nokia Ovi, Flyte)
Digital Landscape
Mobile95%
Internet5%
Digital Sales Breakup -‐ 10-‐11
Mobile80%
Internet20%
Digital Sales Breakup -‐ 11-‐12
CRBT60%
Mobile Radio20%
Downloads & Streaming
20%
Digital Sales & Product Breakdown
Punjabi40%
South Indian 36%
Bengali16%
Rest8%
Regional Content share breakdown
Ringback tone70%
Mobile Radio12%
Ring tones & images5%
Full track downloads &
services13%
Product based breakup of mobile music
Digital Landscape
Live Business Overview ü 2012 had been a big year for Live music industry in India with around 17 Interna8onal acts performed. ü The Indian Live Industry comprises broadly of Brand Ac8va8ons (26%), Managed Events (72%) & Owned IPs (2%). It is es8mated to grow to US$ 900mm in 2013-‐14 growing at Y-‐o-‐Y 20%. 2013 has seen a Y-‐o-‐Y growth of 28% ü Labels and event organizers are seeking to build enduring brands around music plaLorms, events and services. ü Several lifestyles brands are associa8ng themselves with live music events and concerts in order to engage with target audiences and create an experien8al property, e.g.
• Eristoff Invasion, Bacardi NH7 Weekender, The Great Indian Oktoberfest, and Percept’s Sunburn, Universal Music Group has started a ‘music launcher project’ for HP, Coca Cola India’s Coke Studio@MTV, Bacardi India’s Dewarist
24.0%19.0%
14.0%16.0%
14.0%14.0%
19.0%17.0%17.5%
13.0%13.0%
Digital activationsSports
Corporate eventsExhibitions
B2C awards, ContestsBrand events
WeddingsActivation campaigns
Industry AverageB2B awards
TV game show production
Expected category growth rate
• The past year has seen a phenomenal explosion in the Indian independent music , art and culture ecosystem
• This industry has seen a financial year on year growth of 28%
(Source : Events and Entertainment Management Associa8on, Ernst & Young)
From a paltry number of 9 in 2010, the number of art/music/lit fes8vals in the country has grown to 75 + this year.
From an average aUendance of 700 people in 2010, alterna8ve music concerts /fes8vals in India register an average aUendance of 7500+
audience of high spending Urban Youth
An average weekend spend at a music fes8val stands at Rs 20,000 (US$400)+ per person
(Data gleaned from OML fes8vals over the past 3 years)
Publishing Business Overview
• Presence of Interna8onal publishers from 2006/7 • Warner Chappell Music Publishing (represented by Times Music) • Universal Publishing India (fully owned en8ty) • Sony ATV Music Publishing (joint venture with Sony Music India) • The Copyright (Amendment) Bill, 2012 has been passed in May 2012. This has been
welcomed by writers and composers of music as it gives them ownership rights for their works and recognizes mechnicals
• India is incorpora8ng interna8onal and WIPO (World Intellectual Property Organiza8on) norms into exis8ng laws. The new act specifies that the authors (lyricists, composers etc.) of underlying works and assignees (publishers) are each en8tled to equal shares of royal8es received.
2012 Taiwan Pop Music Industry Market Survey
Pop Music Industry-‐ Na8on-‐wide Value Es8ma8on
• According to this research, Taiwan’s popular music industry is valued at 3.49 hundred of million US dollars. (This excludes fiscal income from travel, transporta8on, adver8sement, and entertainment industry and other addi8onal values from transna8onal or cross-‐industry coopera8on.)
Profit From 2009 (Million USD) 2010 (Million USD) 2011 (Million USD)
Record Company 109 115 102
Digital Music/ Media Service Provider 32 39 55
Live Performance 59 62 123
Music Copyright (Corporate Sales) 11 15 13
Music Copyright (Karaoke and Videos) 28 58 56
Total (Pop Music Value) 239 289 349
170
71
25 37
27
9 19
51
12
109
148
121
103
41
0
17
56
264
0 0.7
23
0
45
274
0
49
15
160
141
0
38
0
50
100
150
200
250
300
Albu
m Sales (P
rodu
c8on
Costs includ
ed)
Copyrig
ht Autho
ri8za8o
n
Ar8st R
epresenta8
on
Live Perform
ances
Digital M
usic
Others (Project reven
ue etc.)
Music Dow
nloads
Mob
ile Service (R
ington
es)
Mob
ile Sub
scrip
8on
Broadb
and Stream
ing
Others (Internet M
ainten
ance etc.)
Ticket Sales
Venu
e Re
ntal
Merchandise
Corporate Spon
sor
Music Edu
ca8o
n
Others
Ticket Sales
Venu
e Re
ntal
Merchandise
Corporate Spon
sor
Music Edu
ca8o
n
Others
KTV (Cop
yright Royal8e
s)
Dining
Karaoke Re
cordings Ren
tal
Others (Karaoke Machine
Sales etc.)
KTV (Cop
yright Royal8e
s)
Dining
Karaoke Re
cordings Ren
tal
Others (Re
tail prod
ucts, m
isc. )
Record Company Live House Promoter KTV Distributor KTV Venue Digital Service
Pop Music Industry-‐ Profit Dynamic Breakdown Million US do
llars
Pop Music Industry-‐ Opera8on Gross Profit Analysis
102
55
123
13
294
90
54 59
6
213
12.24%
0.31%
51.92% 50.13%
27.7%
0
10
20
30
40
50
60
0
50
100
150
200
250
300
350
Record Company Digital Music Service PlaLorm Promoter Copyright Management Associa8on KTV Business
Gross Profit % Million USD
2011 Pop Music Industry Gross Profit Analysis
Input Output Gross Profit
Through observa8on and comparison, we can see that Promoters share the highest gross profit at 52.92%. Copyright Management AssociaLons follow secondly at 50.13%. KTV business (venue and distributors) hits 27.70%. On the other end, Digital Music Service PlaMorms has the lowest gross profit of 0.31%.
Pop Music Consump8on Characteris8cs
Subject Album Live Performance
Digital KTV
Average amount (USD)/ per year
$63.49 $81.45 $64.20 $103.33
Consump8on Frequency
2-‐3 8mes a year
2-‐3 8mes a year
Pay by monthly 2-‐3 8mes a year
Consumer Feature
Income and consump8on are directly propor8onal
-‐ Northern Taiwan avg. USD$129.16
-‐ Southern Taiwan avg. USD$93.57
The most popular service is KKBOX
-‐ Male -‐ Higher-‐income
35% of the naLonal populaLon regularly consumes pop music products: In 2011, the other 65% does not purchase music products.
SINGTEL INNOV8 China Music Market May 23, 2013
China Music Market
1.1 Consumer usage trends
27 Source: CNNC, iResearch June 2012
Service No. of Users (Millions) Usage ProporLon (%) 6-‐Month
Growth Rate (%)
Instant messaging 445 82.8 7.2
Search 428 79.7 5.2
Music 410 76.4 6.4
News 392 73 6.9
Personal sites/Social 353 65.7 10.9
Videos 349 65.1 7.6
Games 331 61.6 2.1
China Music Market
1.2 Market Trends • Physical – immaterial
– “The physical market has prac8cally disappeared” China Record Working CommiUee
• Digital – a lot of units, not a lot of money – China digital market is US$205m in revenue (2011) – 280 billion units downloaded/streamed (2011) – Pay model vs adver8sing
• Video – the new fron8er
28
China Music Market
1.3 InternaLonal vs. Local Repertoire • LiUle interna8onal influence but growing
– Live performances by interna8onal acts are notoriously difficult to organize
– Taiwan, Korea, Hong Kong and Japan
29
China Music Market
1.4 Recent industry moves • MP3 Search licensing deals
– Labels and internet players come to the table
• Sites gain trac8on by offering free music to users – Unable to mone8ze current music services offered – Instead pay one-‐8me/annual licensing fee to labels
30
China Music Market
1.6.1 Growth OpportuniLes • July 1st, 2013
– 95% of the China digital music market will begin charging for quality copyrighted music downloads
– Streaming remains free
• Digital Music / Hardware partnerships – Ex: Tencent QQ Music / Sonos partnership
• Tencent’s digital music team has partnered with over 10 Audio / TV manufacturers since 2012
31
China Music Market
1.7 Trends • Digital Na8ves versus Mobile Na8ves • China coming out • Mobile video
– Online video 10% of views in the US and China versus 50% of views in Japan and over 70% in Korea
• Mul8channel Networks/Audience Aggregators • An adver8ng model that works for music
32
Confiden8al and Proprietary 33
Korea: Music Industry Overview"
May 23, 2013 / Singapore"Q Chung"
Managing Director / Sony Music Korea Entertainment Inc."
Confiden8al and Proprietary 34
"• Digital: 10th"
• Physical: 11th""• Synchronization: 23rd"
"• Performance rights: 29th"""
Total market: 11th""
Korea World Ranking in Recorded Music Market"
(Source: IFPI)
Confiden8al and Proprietary 35
Digital Sales vs. Physical in Korea"
(Source: IFPI)
0"
50"
100"
150"
200"
2008" 2009" 2010" 2011" 2012"
Physical"Digital"
52%
45% 45%
45%
56%
48%
55% 55% 55%
44%
(US$ Million, Trade Value)
'Korea was the 1st music market in the world where digital surpassed physical sales in 2007'
Confiden8al and Proprietary 36
International pop vs. Domestic pop (%) in Korea"
(Source: IFPI)
2008 2012
International"30%" Domestic"
70%"
International"16%"
Domestic"84%"
Confiden8al and Proprietary 37
韓流 K-pop goes Global"
Billboard Magazine │ January 19, 2013"
Confiden8al and Proprietary 38
"• Most advanced wired and wireless country in the world"
"• Korea is one of the top 4 net export music countries in the world"
• Open dialogue with and strong support from the Korean government"
• Local digital music portals dominate the local music market
• Local music market driven by artist management companies and local " conglomerates"
Unique market characteristics and strengths"
Confiden8al and Proprietary 39
Korean Digital Music Business"
40%"48%"
53%"43%"
16%"
23%"
20%"
22%"37%"
74%"
14%"10%"
8%"
23%" 22%"17%" 20%"
10%"
0%"
20%"
40%"
60%"
80%"
100%"
2008" 2009" 2010" 2011" 2012"
Other"Ad-supported"Subscriptions"Downloads"
(Source: IFPI)
Confiden8al and Proprietary 40
"• How to maintain the overseas K-Pop boom"""• Lack of industry standards : Awards, Charts and ISRC"
• Digital Pricing not appealing to RO and Artists"""• No global digital music stores/services in local market"""
Challenges"
Confiden8al and Proprietary 41
Growth opportunities ""
• Advanced Digital Infrastructure"
• Potential of International Digital Services launching in Korea"
"• Massive Growth in Live and Artist management business"
• Stronger Copyright Protections"
• Diverse and Dynamic K-pop repertoire""
Confiden8al and Proprietary 42
PSY"
• Release ‘GENTLEMAN’ (Apr. 12th)"• Seoul concert at World Cup Stadium" (Apr. 13th)"• Currently promo tour in North America"
Confiden8al and Proprietary 43
Cho Yong Phil"
• Legendary K-pop Artist"• Release his 19th album ‘Hello’ (Apr. 23rd) "• Dominate every K-pop chart"
Confiden8al and Proprietary 44
2PM"
• Tokyo Dome Concert"• Apr. 20th ~21st "
Confiden8al and Proprietary 45
Super Junior"
• Latin America tour "• Apr. 21st ~ 27th"• São Paulo, Buenos Aires, Santiago, Lima
Confiden8al and Proprietary 46
Yiruma"
• K-pop Producer & Pianist"
• Germany Tour" : Berlin (Apr. 5th) ""• Australia Tour" : Sydney & Melbourne " (May 2nd ~ 8th)"
Confiden8al and Proprietary 47
G-Dragon (Big Bang)"
• Hong Kong Concert"• May 17th"
Confiden8al and Proprietary 48
Jason Mraz & Kim Jong-un (North Korea Leader)""• SNL Korea "• Last Saturday "
JAPANESE MARKET OVERVIEW
Ken Ohtake Music Publishers Association of Japan
Physical vs Digital
85% : 15%
$3.6 billion
Local vs International
87% : 13%
$468million
Uniqueness
Artist Fans≫ Music Fans
Opportunities
Streaming(Challenge?)
Vibrant Live Music Scene
Music Export