December 8th, 2017
Sheer Music boss on how to survive digitization
The digitization of music has ushered immense changes to the African music scene due to emerging technological advancements that have shifted every aspect of the industry, from the way music is recorded to the manner in which albums are distributed and marketed. This has triggered many challenges in the industry such as piracy and declining revenue streams.
It is against this backdrop that music can now be easily accessed through downloads and streaming. In addition, technology is also enabling artists not only to record their music but to directly reach out to the consumer.
Music In Africa spoke to David Alexander, managing director of Sheer Publishing – one of the largest independent music publishing companies in South Africa by market share – to get a sense of where the music industry stands and which direction it is taking amid digitization.
Alexander, who joined the music industry at a time when publishing was dominated by the five multinational record labels – Warner, EMI, BMG, Sony and Universal – said much had changed since he founded Sheer Publishing in 1996.
“Changes from cassette to CD then to DVD and now digital has seen the sales market disappear,” he said. “For instance, we’ve come from selling 10 songs on an album to selling one song on a download and then to a single stream which has taken a lot of value out of the industry for both writers and publishers. We as publishers used to make a large percentage of our income from mechanical royalties, which came from CD sales. This has now been put under a lot of pressure by platforms such as Apple Music, Spotify, Tidal and other music streaming or download sites.”
Physical vs online sales
Since the digitisation of music, subscription streaming services have significantly aided the music industry in terms of publicity. Physical sales are still prevalent in Africa but most CD or cassette albums are used as promotional material to get people to attend live events.
“More recently we are seeing a trend in streaming that has further devalued the sale to the public. Now you’ve gone from buying a CD album for R150 ($10) to R10 a song download to a fraction of a cent stream. How do we compete in this industry?” Alexander said.
“But what has improved over time is the money that comes from public performances. Radio stations are also a good business because we get to cut into a certain percentage of that income via collective societies like SAMRO [the South African Music Rights Organisation]. Composers and publishers have thrived, though record labels are struggling to find an alternative to replace the traditional sales model.”
Alexander said Sheer Publishing had invested in a production service and a stock music library called Skhumba Music to expand the company’s portfolio of services. “We have invested in Skhumba Music and various composers whose businesses we help manage. This has helped us to continue to be relevant while the broadcast environment changes.”
“The administration that backs the three different businesses is solid and focused on providing a solution to each of those separate businesses. I’m grateful that 21 years later we are still functioning and have some of the most awesome songwriter and publisher clients.”
SA vs Africa
Just like Nigeria, South Africa has a vibrant music industry whose artists are making major waves all over Africa. The success of the South African music industry can also be attributed to state-of-the-art recording facilities that lure foreign artists to record in cities such as Johannesburg and Cape Town.
Highlighting his experience with the African music industry as a whole, Alexander said South Africa was more developed than other countries on the continent.
“This is not to disrespect them but to say that South Africa houses all the international record labels and publishers and has a very strong copyright system,” he said. “This is not only in law but also in practice. The physical industry that was successful in South Africa did not prove so for the rest of the continent. For example, the system of distributing music has been dominated by pirates and to this day continues to be so.”
Alexander also touched on copyright issues faced by most African artists. “The challenges in the African countries I have visited are that although they might be good copyright legislation in place, the practice around the collection and administration of royalties has not been very good.
“Collective societies do not collect much money, meaning that they don’t enjoy the same advertising revenue model that exists in South Africa and other developed markets. So if they get any fees from broadcasters, they are flat fees or low rates.”
Alexander said most African composers were not benefitting from collective management organisations (CMOs) in their countries. “The income they receive is not very high and with administrative costs being a high percentage of that revenue, the amount left for distribution to writers is very low. So in many cases it does not pay them to get data and distribute according to the data they may receive.”
Responding to what his organisation has done to educate artists on copyright, Alexander said: “A large part of our work over the last seven years has been explaining to composers the importance of retaining their copyright and how important it is to help their CMO to become a benchmark of good practice in terms of collection and distribution.
“Get involved and change things. In certain territories there seems to be a resonance of that message in the composing and publishing communities. And we have seen an increase in collection and distribution in the Anglophone countries.”
A ray of hope for the African music industry
Notwithstanding their huge presence in music catalogues around the globe, most African artists have not been able to create significant markets in their countries. But this is beginning to change with digital technology giving artists the opportunity to reach out to mass audiences in Africa and beyond. Most African record labels are working hard to establish multifaceted services while investing in artists and their repertoires. But technology is also breaking cultural barriers and connecting artist from different parts of the world. Alexander says there is growing interest in African sound from abroad.
“If you listen to international music trends, popular artists are becoming much more aware of the interesting sounds that we have in Africa,” he said. “Artists such as Drake and Ed Sheeran incorporating and adapting African sounds into their music helps to establish a narrative that there is an interest in our music, not only South African but Kenyan and Nigerian too. For writers open to the idea of collaboration, there is an opportunity for them to grow their audiences.”
Advice to artists and music entrepreneurs
Alexander encourages musicians to take advantage of the Internet to grow their brands and the African music scene.
“Africa has the youngest population in the world and with the penetration of the Internet via mobile devices we have an opportunity to create something that they will be able to share with each other, be proud of and say that this represents us as a people. And so we are excited to be part of that.”
Most musicians are not always prepared to face the challenges of the music industry and many of them end up quitting to find other ways of earning a living.
But Alexander says passionate individuals need to pay their dues before they can be successful.
“In my opinion longevity leads to success. So the trick is to hang in there. I lead my business with four principles: know yourself, keep moving, get better and never give up. These are fundamental approaches to business and to life that informs my every action and every decision I make.”
Source – MusicInAfrica