The revenue from recorded music in the Nigerian music industry has been projected to generate $50 million (about N18 billion naira) by 2020.
This growth was captured in the ‘Nigerian Recorded Music Industry Report (2015 – 2020)’, published by the Disruptive Creative Economy Meeting (DCEM) group, which describes it as the first detailed industry report.
Findings from the report also reveal the Nigerian music industry is poised to spike in growth significantly over the next three to five years.
According to the report, “As internet access becomes more pervasive – thereby increasing the proliferation of service providers – competition in service supply, as well as more “bundling”/zero-rating of entertainment products, will result in a decrease in the effective cost of data. This would mean subscribers having more money to spend on entertainment products such as music and video.”
The report has also established a direct link between a booming telecommunication industry where costs of services are cheap, and the possibilities for increased revenue in the Nigerian music industry.
Nigerian music industry- Digital consumption
Digital music consumption in Nigeria overtook physical consumption in circa 2013. Market revenues from physical sales, which have been declining steadily year on year, are now dropping to well below $10m. to put it in context, CD sales at their peak in Nigeria generated just over $30mn per year.
Car CD players, that helped prolong the lifespan of physical sales, are rapidly being replaced with auxiliary chords and car stereos that are compatible with mobile phone Bluetooth technology. This digital take over can also be
ascribed to the rapid growth in mobile consumption, and further penetration of internet connectivity across the country.
Nigerian music industry- Streaming
Streaming majorly took-off in Nigeria around 2015. Although there were a few local streaming companies before this period, almost all offered streaming services merely as an ancillary service supporting their more core CRBT/download offerings and all had nominal streaming subscriber numbers. None of these platforms achieved any significant growth with respect to the streaming aspect of their platforms and were still heavily reliant on CRBT/download revenues.
It was only in 2015 that the first Nigeria-based standalone streaming platform, BoomPlay, entered the marketplace. BoomPlay with almost 40 million users as of December 2018 is by far the leading streaming platform in Nigeria.
The researchers said the contribution of both sources is projected to increase even further in the coming years, with digital sources considered to offer more data and transparency of how much has been earned by content producers.
It noted that The Caller Ring Back Tone/Ringtone (CBRT/RT) service and streaming both accounted for between 66 percent and 85 percent of revenue between 2015 and 2018.
Nigerian music industry- Sync licensing
The Nigerian synchronisation market is in its very nascent stages.
As has been extensively reported, a boom – both domestically and internationally in the country’s film and television production industry (commonly referred to as “Nollywood”) is well underway. The primary driver of the growth in this sub-segment of recorded music revenues.
According to the report, the Nigerian sync market in 2019 will potentially generate a value of over half a million dollars.
“For the longest time, we have operated as an industry from a place of floating knowledge about the data or statistics in the industry. The average entertainment practitioner gives you an estimated figure. DCEM seeks to change that narrative by ensuring a timely and robust report to service the industry,” said Fawehinmi Oyinkansola, contributory researcher and managing partner of Technolawgical Partners.
DCEM is a collective of specialised professionals (including lawyers, accountants and business advisors). They have actively researched the Nigerian music sector for the past 18 months in order to bridge this data gap.