SA’s music industry: Rolling with the punches

The purchasing model of music has changed. Streaming makes music more accessible to consumers, but it’s a controversial issue for musicians.

Streaming killed the rock star

Streaming provides great value to the consumer, says musician Danny K, speaking at a forum at the Gordon Institute of Business Science. “From the musician’s side, the royalties and the streaming money doesn’t really bleed through enough to make it exciting for us,” he says. Streaming is a product of scale and the returns are only significant if more people pay for streaming services, he explains. “Artists would rather sell one album than have 100 000 streams.” CD sales are dwindling and Danny K describes physical sales for the next 10 years as a race to zero.

Streaming adds another challenge to the already impenetrable music industry. “I think we just try to make the most of what we have and try and plug into what we believe is most valuable,” says J’Something, lead singer of house band Mi Casa. He says that the band has relied on getting shows to promote their music over the past four and a half years. “You hopefully get bookings, which is where any decent money is right now in South Africa,” he says. The live performances are valuable for musicians to differentiate themselves. “No other artist or ‘wannabe’ artist can copy what you lay down on the stage,” he says.

MIND YOUR BUSINESS: Musician, Zakes Bantwini says that musicians don't understand busienss which is a disadvantage when it comes to breaking into the industry. Photo: Chris Gibbons

MIND YOUR BUSINESS: Musician, Zakes Bantwini says that musicians don’t understand busienss which is a disadvantage when it comes to breaking into the industry. Photo: Chris Gibbons

Zakes Bantwini, musician and executive head of A&R at Sony Music Africa, says musicians who aren’t “plugged” into the urban space are further disadvantaged by streaming as consumers of their music often don’t have smart devices. If physical music sales disappear, “genres” will only be available freely on the radio, without other means to consume it.

We are only just scratching the surface with streaming.

David Alexander, managing director of Sheer Publishing, agrees with Bantwini in that there are a large number of people in South Africa who don’t have access to streaming services. This is keeping the demand for in-store sales alive, slowing the downward trend of physical sales. Streaming has also had a negative impact on composers and publishers, says Alexander. The major share (60-70%) of royalties goes to the record label, leaving a smaller share for songwriters and even less for the musicians, he explains.

Contrarily streaming only accounts for 1% of the business, says Sean Watson, managing director of Sony Music Entertainment Africa. “We are only just scratching the surface with streaming.” Most consumers have encountered streaming via YouTube. “People across Africa are accessing YouTube, so they are streaming,” he says. Although smart device penetration is still low, changes to the cost of bandwidth is increasing the popularity of streaming.

Watson explains that the revenue of a CD or download is immediate following the transaction. With streaming revenues only kick in later, as returns on annuity. “As long as people are listening to music, you [musicians] are earning.”

Streaming is more important than radio in some markets, says Watson. In the UK, BBC: Radio 1 is the most important in the world when it comes to breaking musicians. To get airplay on radio, musicians have to have some repertoire, and streaming is good evidence for that. The viral impact of music is also important. “Social media is so plugged into these streaming services that the ability for you to engage audiences through playlists, communications and social media are key.”

Making a break

Despite these odds, these disruptive digital innovations can still benefit musicians. They don’t need to be signed with record labels to break into the industry, says J’Something. Mi Casa recently left their label Soul Candi and are now managed independently. “We have the greatest tool in the world that no artist ever had and it’s the internet,” he says. This is the one reason he believes musicians don’t need a record label to push their music.

I believe the internet is allowing a lot of freedom out there.

“I believe the internet is allowing a lot of freedom out there,” says J’Something. Musicians can promote their songs online, and produce music using software on laptops. “You can do it anywhere in the country or continent. We don’t need the record label’s money to invest in studio time anymore.” Record labels are mainly useful for their contacts, which they guard selfishly, he says.

MUSICAL FREEDOM: J'Something, lead singer of the house band Mi Casa says that the internet has given musicians freedom. Photo: Chris Gibbons

MUSICAL FREEDOM: J’Something, lead singer of the house band Mi Casa says that the internet has given musicians freedom. Photo: Chris Gibbons

In his experience, Danny K says he faced a lot of “attitude and rejection” for five years before being signed. But he adds that it’s part of a musician’s journey. “You are going to get told you’re no good.” He advises that despite the rejections, if you truly have talent or something good to offer, you can find a way in the business. “Cream always rises to the top.” Record labels do make mistakes, they even rejected the Beatles, which turned out to be the greatest band of all time, he says.

Bantwini says that prospective musicians often don’t have the capital or business knowledge to support their talent. This calls for business schools and established musicians to educate young musicians the business aspect of the trade and recreate business models. Musicians should also start to build their brand on social media platforms.

Alexander agrees that with education musicians can make the most of opportunities. Danny K adds that those with an entrepreneurial flair to monetize their brand should embark on that route. For those who do not have a mind for business, he advises them to surround themselves with a good management team.

This article was featured in Finweek magazine.

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