As founder and president of PopArabia and EVP of international and emerging markets at Reservoir, Spek is one of the key music industry executives exploring trends in the Middle East and North Africa, China, India and other high-potential regions.

He joined the NY:LON Connect conference for a fireside chat about some of those trends this week, interviewed by Priyanka Khimani, founder of law firm Khimani & Associates.

It began with talk about the impact that streaming is having on countries with large populations, but which were not historically lucrative markets for recorded music sales.

“The more people there are, the more subscribers there are. The more subscribers there are, the more money you have going into the pool,” said Spek.

“That created a virtuous cycle whereby domestic content would get more investment put into it, and you would end up seeing a lot more content being created and monetised as a result of that.”

This is why Spek moved back from the US to the Middle East, with a focus on that region but also other high-potential markets.

“The streaming era represented a game-changing moment… and I felt like I’d be crazy if I didn’t go back and focus on the emerging markets. because my feeling was that in the next 10 years, the battlegrounds are going to be Africa, India, China and the Middle East.”

‘It’s a matter of time before China overtakes the US’

China is clearly of strategic importance to Reservoir, as shown by its partnership with and minority investment in Outdustry, which was one of the first western music companies to focus on China.

Spek praised Outdustry (“they’ve really opened the market up… they helped to break the mould for licensing in that market”) and outlined his wider expectations for China as a music market.

“It’s not controversial to say that China is going to at some point become the biggest economy in the world. And when you are out bouncing around in Asia, most people will say that it’s a matter of time before China overtakes the US and becomes the biggest music market in the world,” he said.

“Just by sheer volume of the size of the market. I think that’s an impending reality. Whether that’s a couple of years or many years from now, but it’s going to happen.”

“When you look at the statistics and the data, what you see is that the majority of consumption of music [there] is Chinese content. And if you’re an enterprising entrepreneur, you should be looking at what’s the best way to invest in that content.”

Reservoir hopes that Outdustry will provide it with that insight, as well as in India. He contrasted the two countries’ music landscapes.

“In China, the challenge is how regulated and top-down the country is, and navigating around that in order to open up opportunity around investments in Chinese artists, and connecting those dots,” he said.

“In India, it’s quite different… you’ve got this rich history, and this rich culture, and this rich catalogue of music that is imprinted in the minds of every Indian around the world, so you’ve got a lot to work with.”

However, there are challenges: Spek said that there is a lot of legacy issues around rights and the music ecosystem in India that still needs to change, even though there has been a lot of progress over the past 10-15 years.

‘Gully Gang is going to be the Indian version of a Bad Boy or a Death Row…’

He also enthused about the growth of independent Indian hip-hop, which a decade ago was “not really a thing” in the country. Rapper Divine is one artist who has broken down that barrier, and helped to spawn a thriving scene.

“I think when we look back, we’re going to look back at him as the guy who broke the dam… He’s a large part of the reason why hip-hop has become popular music, and so widespread and mainstream in India,” said Spek.

“It’s really refreshing that in a world where Bollywood and film studios and the manufactured star is such a part of the pop culture of India, you’ve got a new pop culture that’s evolving that is coming from the streets and is magnifying itself out not just in India, but around the world.”

When Divine releases a new single, Spek has noticed that reaction videos are posted on YouTube by young people across the world.

“Kids in the States, kids in the UK, kids in France, kids in Canada. Black, white, Latino, Indian. It’s really not just an Indian phenomenon any more,” he said, praising the Gully Gang Entertainment company that Divine launched, and with which Reservoir has a joint venture.

“It’s not rocket science. You look at what’s happened in hip-hop around the world. Gully Gang is going to be the Indian version of a Bad Boy or a Death Row or a Cash Money or a Good Music. Whatever analogy you want to use, they are that company.”

Spek has also been working hard on ESMAA, the MENA-focused rights-management subsidiary of PopArabia which was inspired by the sight of other independent management entities (IMEs) operating around the world as alternatives to traditional collecting societies.

He said that the venture has received some criticism in the Middle East from people who are not keen on the idea of a rights management organisation that is not structured like a traditional PRO.

“My argument to that would be: I think it’s silly to make perfect the enemy of progress. You have to start somewhere,” he said.

“You can wait for somebody to show up on a white horse and solve the problems, or you can work out a way to navigate the regulatory environment as it is, and start to make progress to make sure that rightsholders are getting paid.”

“We obviously chose the latter. I get the critique, but I just don’t think it’s a valid critique.”

Spek went on to develop those thoughts in reference to wider success in emerging markets for music organisations and companies.

“You have to start somewhere. I think that we can very easily be on our high horse about ‘well, it should be like this because this is how it works in the west’. And in my experience, that’s not the pathway to success in emerging markets,” he said.

“The way to win is not to try and force a square peg down a round hole. You have to adapt, you have to localise, and you have to understand your environment and your market, and work with people who really understand the local market and have those relationships that count when you need them.”

Spek’s fireside chat was part of the ‘Publishing – Buying & Managing Catalogs and Growth Markets’ track at NY:LON Connect, which was sponsored by Muserk. Music Ally and Music Biz co-run the event, and you can read our full coverage here.

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