Why Norway and the UK produce the world’s most valuable music fans

By Tim Ingham musicbusinessworldwide.com 9/10/15

Ask those in the record business about the markets that really matter to the global industry’s bottom line, and they’ll tell you about ‘the big three’.

A few years ago, that would have meant the US, Japan and the UK.

But these days, it’s the US, Japan and Germany – the outstanding trio in terms of annual cash spent on music.

Last year, across record sales, sync and performance rights, these nations generated $8.9bn between them, according to the IFPI.

To put this dominance in context, let’s look at the US alone.

In 2014, says the IFPI, the country’s record business attracted US $4.9bn – a third of the global business’s entire revenue.

The US haul was close to double the $2.63bn pulled in by Japan in 2014 and not far off quadruple Germany’s $1.4bn.

But here’s a bit of a shocker – the US market also turned over more than all of the following markets combined:
UK
France
Australia
Canada
South Korea
Brazil
Italy
Netherlands
Sweden
Spain
Mexico
Norway
Austria
Belgium
Switzerland

[If you want to go really in-depth on the figures, MBW recommends picking up the IFPI’s Recording Industry In Numbers 2015 book.]

However, sheer brute size possibly isn’t the best way at evaluating the true value of these countries for the record business.

Another way to slice the pie is actually to investigate how much per person in each market is spending on music each year.

MBW has crunched the numbers of this per capita spend- dividing 2014 recorded music income in the IFPI’s Top 20 markets by the size of their population.

This tells us which music fans are really spending the most on records.

And it makes for a quite surprising list:
1.Norway: $23.58 per person
2.UK: $20.81
3.Japan: $20.64
4.Sweden: $19.75
5.Germany: $17.42
6.Australia: $16.26
7.USA: $15.36
8.Austria: $13.56
9.Switzerland: $13.39
10.France: $12.76

As you can see, Norway’s population, on average, shelled out US $23.58 on recorded music in 2014.

According to the IFPI, the Scandinavian country generated $119.9m from records last year – a spend driven by a population of just 5.084m people.

Brits can feel pretty chuffed with themselves, too. The UK market generated $1.334bn in 2014 – from a population of 64.1m people.

Germany may have overtaken the UK market in terms of revenue generation in 2011, but in terms of per-consumer spend, it’s more than $3 behind at $17.42.

And then there’s the other side of the story.

Those countries whose population – for a variety of economic, cultural and legal reasons – just aren’t pulling their commercial weight for the record business.

Below, you’ll find the sin bin of markets (in the world’s Top 20 biggest recorded music territories) whose per capita spend is the lowest.

It’s led by China; according to the IFPI, the 19th biggest recorded music market in the world, generating $105.2m in 2014.

But China also has the world’s largest population at 1.357bn people.

It’s a similar story in India (1.252bn people).

(Here’s an especially miserable stat about India, which generated just over $100m last year: according to the IFPI, subscription streaming revenue fell 42% in the country to $12.37m in 2014. Cash from free streaming? That grew 108% to $22.72m. Problematic.)
1.China: $0.07
2.India: $0.08
3.Mexico: $1.07
4.Brazil: $1.23
5.Spain: $3.87
6.Italy: $3.93
7.South Korea: $5.29
8.Canada: $9.74
9.Belgium: $9.93
10.Netherlands: $12.19

Note: All local currencies translated into US dollars at 2014 exchange rates

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