00:00Taylor Swift is at the top of it, Benson Boone is at the top of it, Sabrina Carpenter doing very well.
00:04We could end up, if we're not careful, in a world where human-created music has no value.
00:16Welcome to The Big Question, the series from Euronews where we dive deep into the world of business.
00:22Today I'm joined by Victoria Oakley, the CEO of IFPI, the global industry body for record labels.
00:28Thank you very much for joining me today.
00:29So just to get us started, can you just explain for those in the audience who might not know,
00:33how does the music industry work and what is the role of a record label?
00:36It's a bit of a higgledy-piggledy structure, I won't pretend otherwise.
00:40So touring and live and concerts are huge, right?
00:43Then streaming, where you perhaps do an awful lot of your listening.
00:48There is publishing, there is songwriting, there is music for film, there's music for adverts,
00:55there is merchandising, there's all, you know, this whole ecosystem of different ways in which artists
01:00both reach their fans and make money and can thrive as artists.
01:05The record labels that we represent as the trade body for the recording industry
01:09are the companies and the groups of record labels that take on artists,
01:13they find them, they sign them, they represent them, they act as rights holders for them
01:18and they help them to ensure that their music reaches audiences.
01:25You at IFBI have published your global music report.
01:29Can you tell me some of the key takeaways, what are you seeing in this report?
01:32It's really interesting because you would think that we would know exactly what was going to be in it
01:36because we're watching the music industry as it evolves every year.
01:38But humans are interesting people, right?
01:40And we listen to different things at different times and we make choices
01:43and something catches fire and something doesn't.
01:45And what we're seeing in 2024 is continued growth in the music industry, which is great news.
01:51We're seeing that there are some very fast-growing regions where revenue from recorded music is up
01:57and that's in Africa, in the Middle East and in Latin America, all growing really, really healthily.
02:03And we are seeing some slowing of the overall growth rate,
02:06but frankly still in ways that many, many other sectors would be incredibly envious of, I have to say.
02:12What's particularly interesting, I think, is in Europe, which had not necessarily been hugely successful,
02:17hadn't had very powerful growth rates for the last handful of years,
02:20but has really come back and is somewhat bucking the broader trend
02:24and showing a growth rate between 8% and 9%.
02:27Why do you think that is?
02:28We've seen a number of things in Europe.
02:31One is around their own artists.
02:34So what's really interesting about most European countries is they consume their own music,
02:40often in their own language, more than almost anything else.
02:43So yes, major global artists do very well in European countries, of course they do.
02:46They are all expressing a clear preference in sales terms for their own artists in their own language.
02:53Looking at the music market in Europe specifically, what are the key revenue drivers here?
02:56We've seen an increase in streaming, so in the number of subscribers taking up streaming,
03:03which means more people listening to more music more often.
03:05And it is the main way in which people are listening to music,
03:07which isn't true everywhere in the world.
03:10We've certainly got some markets, for example, Japan, where physical purchases still play a huge role.
03:15CDs?
03:16Yeah, CDs in a big way.
03:17We should talk about vinyl though, because that's interesting.
03:19I don't know if I would say vinyl is back and that's the future
03:22and we're all going to stop using platforms and start listening with record players instead.
03:27But people are buying a lot of vinyl.
03:29So you've got parts of the world where they always have, certainly in Asia.
03:33So in South Korea, it's absolutely crazy.
03:36And actually in other parts of the world, where they're listening to K-pop in particular from South Korea,
03:41they often buy it first on vinyl.
03:43What you also have is a lot of what we would call superfans buying vinyl as a collector's item.
03:49And they will buy multiple different versions.
03:51And it's really important to fans who want to have that kind of really strong personal connectivity with their artist.
03:58And would you say there's any particular genres that are driving the industry at the moment?
04:02You can look at the top 10 anywhere in the world and you can see that the top 10 are essentially
04:07some of these very well-known names.
04:09Taylor Swift is at the top of it.
04:11Benson Boone is at the top of it.
04:12Sabrina Carpenter doing very well.
04:14Teddy Swim's doing very well.
04:15What's interesting though is it does vary country by country.
04:18In fact, in Italy, the top 10 are the most popular artists.
04:23What's interesting though is it does vary country by country.
04:26In fact, in Italy, the top 10 albums sold across the year in 2020 were all by Italian artists and sung in Italian.
04:34So there is no single answer to what's doing well.
04:37Because what's driving growth in Italy is completely different to what's driving it in China.
04:43And isn't that the great joy of the music business?
04:45That there's something for everyone and that something you love I hate but we can both have access to it.
04:51Do you think that Europe poses a particular challenge for artists,
04:54being such a diverse linguistic landscape, for artists to expand beyond their domestic territory?
05:00About 15 to 20 plus years ago, you had to sing in English to really make it to the top, right?
05:06And so music from America, Britain, Canada did incredibly well in most places.
05:12That is just not the case anymore anywhere in the world.
05:16Although I shared the Italy statistic with you, a statistic close to that is true of nearly every European country.
05:22Although a lot of people still listen to music in English, there's great joy in listening to music in your own language.
05:27It's a celebration of your culture and you probably feel very deeply connected to it
05:33when it's an artist from your town, your country, your village singing in your language.
05:37The challenge then is around export.
05:39I mean, who'd have thought 10 years ago that every teenager all over the world would be listening to K-pop?
05:44They have managed to absolutely export their music, often in their own language.
05:48It's become a real phenomenon.
05:50And so if South Korea can do it, there's no reason that nobody else can't.
05:53A big conversation that's happening in every industry in the world is AI and the role of AI going forward.
05:59So what is the stance from record labels on AI usage in music and what are the concerns?
06:04So you said AI, and I'm going to say it depends if you're talking about AI or generative AI.
06:09Okay.
06:10And the distinction is really important.
06:12When it comes to generative AI, I think it's trickier.
06:15There's a really fundamental principle, which is that if there is a gen AI model or a large language model
06:21that needs to be trained on vast quantities of high quality material in order to create an output,
06:26and it needs to do that with authorisation.
06:29So quite frankly, basic copyright rules, which we have all around the world, need to be applied in a gen AI world.
06:36And the risk here is that if we don't get that right, we could end up, if we're not careful,
06:41in a world where human-created music has no value.
06:45Because if you can just make this slightly rubbish music for free, or as good as, and churn it out,
06:52then why would people, either from a business perspective as investors, or indeed as artists, get into the music market?
07:00Yes.
07:01I don't want to live in a world where 20 years from now, you can't go and see a live concert of a human artist
07:07because it's not possible for them to make money as musicians and artists.
07:10I think the other risk, possibly, if you move to a world where gen AI becomes the main producer of music,
07:18is it narrows, right?
07:20And so what happens to all those interesting genres that, you know, maybe a smaller number of people listen to?
07:25What happens to folk music? What happens to bagpipe music?
07:28I mean, maybe there's not a huge audience for these things,
07:31but I think the great joy of this democratisation of music that we've seen recently
07:35is that there is something for everyone, that you can access these types of music, that there is a home for it.
07:40And I really don't want to live in a world where that's narrowed,
07:43and the genres that are perhaps less successful get abandoned.
07:47Well, on that note, that's all we've got time for, but thank you so much for your insights today,
07:51and thank you for joining me on The Big Question.
07:53Thanks for having me.
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