The Nigerian music industry will come to rely on digital sales for a bulk of its revenue in years to come while physical sales are expected to keep declining.
According to Pricewaterhouse Coopers’ 2016-2020 entertainment and media outlook, the Nigerian music industry will pull in an estimated revenue of $51 million (N16bn) from various platforms by 2017.
In spite of Nigeria’s recession, the music industry will continuously grow year-on-year till 2020 when it is expected to generate $86 million(N27bn).
A bulk of that money will be made from mobile phone users who purchase music online, an indication that Nigeria would be greatly affected by the global digital disruption.
Revenue from live music ticket sales is projected to have a relative growth over the next four years while live music sponsorship will record a slim 0.01% growth from 2016-2020.
The report noted that “music streaming is taking a rapidly-rising share of overall global recorded music revenue”.
“A major tipping-point was passed in 2015 when digital recorded music revenue exceeded physical for the first time.
“However, digital downloads are under growing pressure from streaming, as consumers shift away from owning music and towards paying to access it through providers such as Spotify and Apple Music”, the report said.
The PwC report added that global music revenue will rise at a 2.1% compound annual growth rate to US$47.7bn in 2020.
It also highlighted the increasing dependence on live music, which it says, “has triggered new strategies and revenue streams”.
“Given the decline in recorded music sales in recent years, artists are now more dependent on earnings from live music performance than ever before.
“This shift from recorded music to live has changed the economics of the industry, with record companies extending their revenue streams to include live performance, and concert promoters expanding into artist management”, the report added.
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