There are plenty of reasons to be excited about the future for digital music in Africa, with trends including young populations; the rollout of smartphones and mobile networks; and the emergence of local streaming services.
Two sessions at Music Ally and Music Biz’s NY:LON Connect conference in London today explored what’s happening in Africa, as well as what might happen next.
It started with an overview presentation by Ikechukwu Onuorah, 2nd vice president at the Artiste Managers Association in Nigeria (AMAN), which acknowledged both the opportunities in Africa, but also the challenges that must be tackled.
“It’s fair to say that African music and African culture has impacted the world,” he said by way of introduction, pointing as one example to the way its music travelled to the US and gave birth to genres from boogie-woogie and gospel to funk, blues and hip-hop.
Onuorah outlined the major music territories within Africa. “When we think of Africa there are four key markets. Egypt in the north, Nigeria in the west, South Africa in the south and Kenya in the east,” he said.
These countries share some challenges, including high piracy and poor enforcement (of copyright), but there are also some differences.
“We [in Nigeria] are still struggling to have the right kind of infrastructure when you compare it with South Africa, that have major labels in place, publishing in place, touring in place. We’re still trying to build all this in Nigeria at the moment,” noted Onuorah.
“Kenya has the best technology system in Africa going forward when it comes to the business side of things. Their local music distribution platforms seem to be doing a better job than anywhere else in Africa.”
Another challenge in Nigeria: local artists are finding listeners around the world, but don’t always capitalise.
“Our music is reaching the international stage much faster than we are able to do business,” he added, while noting that training remains a challenge.
“In Nigeria we don’t have an entertainment law degree course. Our industry is being run by people who have studied criminal law, family law. Every other law but entertainment! So we are now looking at how we build the next generation of music and cultural industries executives.”
That includes training for managers provided by AMAN. “How can we empower our managers? We now see a lot of artists getting international opportunities… but the managers are not equipped to deal with the type of deals going forward.”
Onuorah also talked about challenges around royalties: there are collecting societies and trade bodies, but enforcing copyright laws is not a high priority for many governments.
“There’s a lot of embezzlement of money and poor administration, so a lot of artists begin to lose faith in the collecting societies, but my argument to them is that a lot of African collecting societies are operating in the 21st century when all of a sudden the eyeballs of the world are on them.”
By that, Onuorah meant that the established collecting societies in the western world did their painful growing-up decades ago, out of the spotlight – but they would have experienced similar problems then to that of the African societies now.
“No collection society is perfect, and Africa is growing and trying to adjust to a number of things while the world’s spotlight is on it,” said Onuorah.
Other issues cited in his speech included a lack of medium-size venues in Africa, making it difficult to plan tours outside major cities. Too few experienced promoters, poor security and the fact that many music fans can’t afford to buy tickets were also mentioned.
Even so, positives include the ability for African artists to sell out venues in other parts of the world, often under the radar of the local industries – for example, Nigerian star Davido will soon play a sold-out concert at the 20,000-capacity O2 venue in London.
“We’re doing all of this through social media. We don’t have the finances for big billboards. We’re using technology that you have created for us, in a different way. We’ve sold all this out through Twitter, Facebook and Instagram,” said Onuorah.
More generally: “We are now celebrating our culture and changing the narrative. Yes, Africa is still struggling, yes there’s a number of challenges going on over there, but we are aware of our power right now and we are trying to do something about it, as opposed to waiting [to be helped out]” he said.
Onuorah made a call for western music companies to come to Africa, but to come looking for partners who know these markets for true collaborations.
“We need more music-based companies that understand the music business, looking to come in to Africa and look at how we can do capacity-building projects and training,” he said.
[Onuorah is working with Music Ally on the launch later this year of Music Ally Africa, which will be part of that process.]
“Africa is going to become a new superpower. It’s an opportunity for you, it’s just a matter of time, it’s going to happen, and you can feel the momentum of what we’re doing,” he said, suggesting that a new wave of artists will capitalise.
“We call it Afro / Avant Garde because they are fusing different sounds, different genres together. And these kids are very brand-savvy, they’ve already got their images on point… and they’re very, very business-savvy.”
But on those partnerships. “Let’s develop Africa together. Let’s look at ways that we can get the data that a lot of you need in order to make calculated business decisions. Let’s help train the next generation of potential music-business executives,” said Onuorah.
“Does Africa have challenges? Yes it does… however, we are aware that we have an opportunity right now. We are moving forward. Africa presents opportunities. It’s rebranding, it’s rebuilding, it’s leading the way right now. Whether you come or not, the bottom line is we’re doing business, we’re doing new business. We’re here to stay, and you’re going to know about it!”
“And don’t forget, China is already in the market. So if you’re looking for statistics, know that by the time China provides you those statistics, we’re going to have locked down all the deals with China. And you’re going to get the crumbs!”
Onuorah’s talk was followed by a panel discussion about trends and opportunities in Africa. Speakers included Onuorah; Aibee Abidoye, general manager at Chocolate City Group; and Martin Nielsen, CEO at digital service Mdundo. The moderator was Virginie Berger, managing partner at DBTHCapital Ventures.
Nielsen kicked off. “What is quite important: you have to acknowledge the fact that every single African country is very different within themselves. We see a lot more market segments across countries, but in specific segments.”
He suggested that the target market is more about the 300 million people who own smartphones, across countries “that reaches a critical mass that makes the financial opportunities enough to build a business around… most young Africans are extremely tech-savvy, so social media is what connects that group across the continent”.
Abidoye talked about language barriers: not just different languages within a country like Nigeria, but different dialects within those languages. “It is, even more so than maybe other parts, quite a distinction between different places. So the product offering has to be very particular. How do you transcend these differences, or how do you create something that can apply to a particular niche?”
The conversation returned to some of the issues with collecting societies: for example, the fact that two competing PROs in Nigeria can be a barrier to artists getting paid for plays of their songs.
“The radio station says I’m not going to pay because I don’t know who to pay! So you have artists who are played heavily on radio, and they’re not getting the actual funds remitted to them,” said Abidoye.
“There’s a lot of corruption that you also have to deal with. We have organisations but we don’t have the legal force to get them to do what they’re supposed to be doing, because we have ineffective legal systems. That’s the problem. They are collecting, but they’re not collecting accurately or effectively, to create the kind of ripple effect that we want.”
Nielsen talked about how Mdundo licenses music for its service, noting that it has individual agreements with between 40,000 and 50,000 musicians – essentially the kind of direct deals that Spotify is starting to explore in the west.
Abidoye also noted that telcos are important players in the market with their own streaming services. In terms of her own revenues, she noted that they had switched from being around 61% from ringback tones in 2017 to 60% streaming now.
Onuorah had strong views on the telcos. “I am slightly concerned. I appreciate what the telcos are doing: they’re getting things happening… but the telcos represent the wrong business model for African music,” he said.
“They get in all of this data, and that data is not trickling down to the artists.If you have a deal with a Believe Digital or Deezer, you can access the back-end and use that information and plan your next campaign going forward.”
“Telcos don’t give you that, and they also keep the lion’s share [of royalties]. It’s 70/30 in their favour… We need companies that are coming in and pairing up with distribution platforms that have the agenda of the business in place. That’s how you grow this thing and go forward. We need to take the power away from the telcos and come up with a better business model.”
The panel returned to the theme of international companies coming to Africa looking for genuine partnerships.
“People need to stop being so afraid about coming to invest, it’s about the right people and the right team,” said Abidoye.
“I would advise that people use local partners, because a lot of business in Nigeria is about who you speak to, who you know. The problem is that people come in and they want to do it by themselves, and they want to have Nigerians that they hire. It’s different when Nigerians are hired, and when they’re invested in the business… People are proud, and they don’t forget! We also want to own whatever it is we’re doing.”
How are the entities that release music in Africa evolving? Will it continue to be largely artists and managers self-releasing, or will there be larger labels? And what will the impact of major labels like Universal and Sony be in the region?
“We’re probably one of the only independent record labels that still exist… What we’re seeing is a lot of independent artists are doing something really fascinating with the management. They’re cutting through the whole structure of what a traditional record label would be,” said Abidoye.
“They are encountering issues with funding, because it’s so expensive to promote music,” she said. “But they get more eyeballs. Artists can simply go on their Instagram and say ‘check out my music’”
Abidoye said that her company is exploring how it can complement those independent artist/manager combinations “within an ecosystem that supports, so it’s more services-based rather than ownership-based: it’s not ‘I own your music’ but ‘How can I support you?’.”
She said she’s not feeling threatened by the moves being made by international major labels – for example Universal Music has opened offices in Africa recently.
“Universal are in the market but I’m not so much threatened by them. I don’t think the approach was right. They are still really trying to understand the market, and how do we make this work?” she said.
“Coming in to the market, it’s one thing to be present in the market, it’s another to be effective. And I think that comes from collaboration with people who are already there, rather than throwing your weight around.”
Nielsen agreed, saying that a lot of the bigger African artists who’d be most interesting for the international majors are sitting back and asking “This is my business: what are you adding to it?”
“Those who have ambitions to cross over and get a more global brand might see some value… and maybe some touring support. But generally speaking at this point they’re thinking ‘I don’t really need it, and it’s a bit late’. So it’s more about starting from scratch and thinking ‘How do we invest in the new generation of artists?’”
Onuorah agreed that artists and managers who are in the driving seat. “Yes, it is the artist and manager relationships going forward. That is looking like the new business model… which is why it’s important that we now start training our managers and start putting in place the right infrastructure for them to conduct their businesses going forward.”
He returned to the theme of partnerships. “You need to partner with us: we understand the culture. We have built this! And this is a market where the culture is so important. When you come in with just money, you’re disconnected, and you’re going to get very frustrated, very early,” he added.