For this week’s Q&A Kehlan Kirwan talks with Victor Finn, CEO of IMRO. The Irish Music Rights Organisation recently announced that music is worth €470m to the economy. Victor talks to Kehlan about the importance of music to the economy.
How is the music industry worth so much to the economy?
Well the research, which was undertaken by Deloitte, showed music is contributing annually over €470m to the economy. That’s despite the fact that recorded revenues have fallen significantly over the past five to seven years, falling from €72m to €33m. Recorded revenues are those which include CD sales, downloads, streaming and all the other forms of how people consume music. So is this impact coming more in the live gig / concert side of music? Live music is worth significantly more than the recorded music side of the industry.
Recorded music is worth €33-34m annually, however live music is probably hitting the €100m mark. So it’s a far more significant player for the music economy. So when we talk about the overall sum we’re talking how the music industry impacts directly and indirectly on other industries as well as the music industry itself. So for example radio stations obviously need music as part of their offering to listeners. So those radio stations then generate revenue through advertising etc.
And how is digital effecting the music industry?
Digital makes up slightly more than half of total revenues in the recorded music space. The physical markets in the last 18 months has recovered somewhat. We’re also seeing a fairly major shift in digital revenues as well. More people are accessing streaming services like Spotify and we’re seeing a corresponding drop in the amount of downloads. So we need to make sure that revenue that goes to compensate music writers and artists is at a sufficient level that consistently attracts young people into the industry.
Where do music makers and writers make money from the likes of Spotify?
There two elements to the likes of Spotify and streaming services. One is where there is a subscription models where subscribers pay a monthly fee to listen to the service. There is a reasonable amount of income coming into the industry from this model. This income is then split up using the licensing services like that from the IMRO. The second stream is on ad supported services where the service is free to use and the music providers get much less revenue from these types of services. So the premium services which the likes of Spotify offer, are really where the music industry wants the consumer to be.
Has become easier or harder to make a living in the music industry?
Well, there has certainly been more money taken out of the industry in the past numbers of years of that there is no doubt.
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