February 12, 2020
Since the debut of music streaming platforms, digital music revenues are achieving record levels of growth. Contributing to this is that while primary markets mature, emerging markets for streaming are also appearing. One such is on the continent of Africa where digital collections have grown by 32.5% in the past 5 years (CISAC Collections Report 2019). In Africa, traditional media accounts for the majority of collections, however, industry experts share that this could be set to change as digital collections grow market share.
This growth could be driven by several factors. Firstly, there is a high mobile phone penetration, which lends itself well to music streaming. GSMA reported 239 million phone internet users in Sub-Saharan Africa in their The Mobile Economy 2019 report. Another factor is that Africa has the youngest median age in the world, 25 years old. Also as the internet infrastructure improves, so will access to streaming. However, one big reason that streaming is growing in Africa is down to the success of Boomplay, the music streaming application that is dominating in the region.
Despite the global domination of streaming giant, Spotify, in Africa there is a different story. With the platform only available in 5 countries this created an opportunity for an Africa focused platform to fill the gap. Chinese technology entrepreneur John He (Transsnet) saw an opportunity in this market. Starting as a mobile native app on the hugely popular Tecno phones in 2015, Boomplay began to occupy a space left open by Spotify. With a plan to offer a high quality music app experience to users across Africa, Boomplay has experienced rapid success. This demonstrated the appetite for music streaming across the continent. In a November press release, Boomplay shared that membership had grown to 62 million.
Relating to music rights collections, Boomplay has a focus on real transparency and fair payments. On the platform, they encourage artists to sell their own music through ensuring timely payouts, a choice of payment types and importantly data accessible by content providers. The company also seeks to promote African artists, providing a simple way for them to access their huge user base. Through a key strategic partnership with Merlin, the world’s largest rights organisation for independent music, Boomplay furthers their endeavour to pay artists correctly and fairly.
Many challenges face Boomplay as they seek to develop the African music eco-system, primarily weak copyright laws and poor internet infrastructure. Despite these issues through funding and partnerships, Boomplay is set to strengthen its African and global footprint. On the business development side, they received funding of $20 million in the first half of 2019. This funding will allow them to expand their app further into the continent. Along with with this investment funding, the world’s largest music labels, Sony Music Entertainment, Warner Music, Universal Music Group have established licencing deals with Boomplay. These key partnerships will allow the streaming application to expand their music database and offerings for consumers.
Despite traditional collections leading the African market, it is clear that digital collections will continue to rise. For CMOs they must prepare for collections from both new markets and new platforms as streaming continues to grow. Along with Africa, many emerging markets are on the brink of a streaming revolution. Talk to the Matching Engine Team about how best to manage new music collections data.