British executives are flying high in the global music business. The leaders of Universal Music Group (Sir Lucian Grainge) and Sony Music Group (Rob Stringer) are both Brits, as is the global head of recorded music at Warner Music Group (Max Lousada). Elsewhere — global A&R at Kobalt is run by a Brit (Sas Metcalfe), while the CEO of Warner Chappell, Guy Moot, is also Blighty-born. The list goes on: Steve Barnett (CEO & chairman, Capitol Music Group), Peter Edge (CEO, RCA), Darcus Beese (President, Island Records) and Merck Mercuriadis (CEO, Hipgnosis Songs Fund)… all Brits.
And on Tuesday (June 23rd), another British executive ascended to the industry’s top table, with ex-Warner Chappell exec Mike Smith being named global president of music publishing at fast-growing Downtown. (Downtown remains best known as a “pubco” — and the parent of publishing-administration platform Songtrust — but has recently made a splash in recorded music too, via acquisitions such as CD Baby parent AVL, for around $200m last year, and artist/label-services platform FUGA, for upward of $40 million earlier this year.)
Why do British music executives keep pipping their American peers to the worldwide industry’s top jobs? It’s a complex discussion, especially against the backdrop of other important conversations right now, but some suggest the genre-agnostic nature of mainstream British music radio — and the arguably less strictly genre-categorized nature of the U.K. industry — may play a role. Another definite factor is that the British music industry has long “punched above its weight,” creatively speaking, by unleashing global megastars ranging from the Beatles to the Rolling Stones, Queen, Led Zeppelin, Coldplay, the Spice Girls and, more recently, Ed Sheeran, Adele, and Sam Smith.
In the past few years, however, as domestic hip-hop artists have cranked up their dominance of U.S. streaming charts, emergent British stars have found conquering the States a mite more difficult. Thanks to a recently released compendium of stats, we have the receipts on this fact. The U.K.’s annual market review All About the Music is published by local music body BPI each year. The latest edition shows that British artists made up just 7.9 percent of on-demand streams (video and audio) across the top 3,000 artists in the U.S. last year. On the global stage, there was brighter news for British acts, who claimed an 11.1 percent share of worldwide hit streams across all formats — with artists from the U.S. at 51.9 percent.
Some suggest that the ruling echelon of British music executives right now have emerged because the average U.K. citizen simply loves music more than the average U.S. citizen. Thanks to All About the Music, this myth can finally get the drubbing it’s long deserved. According to my reading of RIAA stats, U.S. consumers spent $8.77 billion on music in 2019 across streaming subscriptions, digital downloads/ringtones, and physical music. And according to estimates from the U.K.’s Entertainment Retailers Association, printed in All About the Music, British consumers spent £1.418 billion ($1.81 billion) on the same formats in the same time period.
There are an estimated 328 million people living in the United States, while the U.K. counts around 67 million — meaning that, in 2019, the average U.S. citizen spent $26.74 on recorded music, while the average U.K. citizen spent an eerily similar $27.01. Be gone, erroneous cultural assumptions!
If you look hard enough in All About the Music, there are a number of interesting insights like these to be gained about the global music business, and both the U.K. and U.S.’ place within it. Here are three more:
1. Catalogs appear to be increasing their power in streaming — but, actually, the Sixties are getting left behind
According to the BPI’s analysis, catalog tracks in the U.K. represented 60.3 percent of the 114.2 billion plays on audio-streaming services in the U.K. last year. In this case, “catalogs” refer to tracks released in or before the two prior calendar years (i.e., anything released in 2017 or earlier).
Via this definition, catalogs’ share of the U.K.’s audio-streaming volume rose significantly in 2019, up from a 56.5 percent share in the prior year. Although catalogs naturally get bigger every year — each week that passes adds more to the pile, after all — that’s still a material increase (from approximately 50.8 billion catalog streams in 2018 to 68.9 billion in 2019).
Yet these catalog streams require additional examination to understand what’s truly going on. According to BPI analysis, catalog tracks released between 2010 and 2017 claimed 49.1 percent of audio-streaming catalog plays in the U.K. last year. According to my calculations, that itself was equivalent to 29.6 percent of all audio streaming plays (including new tracks). Tracks released between 2000 and 2009, meanwhile, made up 11.7 percent of all plays.
In other words, based on the BPI analysis, 81 percent of all audio streams in the U.K. last year were of tracks released after 2000. Tracks from the entirety of the swinging Sixties, meanwhile, made up just 2.5 percent, meaning they were played nearly 16 times less frequently than tracks released in 2018 and 2019 alone.
2. People don’t listen to music every day — because people are strange — and less than half of them pay for it
One fascinating part of All About the Music that reveals a lot about the modern entertainment business pertains to a consumer survey of more than 3,000 Brits by AudienceNet/Audience Monitor.
Some 77.2 percent of respondents said they listen to music on a typical day, which, at face value, is obviously a bountiful statistic in terms of the universality of the record industry. Yet, on the flip side, it also reveals that 22.8 percent of people, nearly a quarter of us, do not listen to music on a typical day. The music industry should bear this in mind when daydreaming about the potential future audience for music streaming around the globe.
Talking of which, All About the Music also offers us some useful data as to the penetration of paid streaming in the U.K. (which, by the way, is the world’s third-biggest recorded-music market behind the U.S. and Japan). A separate cited consumer survey, of 15,000 people aged between 16 and 79 by Kantar Worldpanel, reveals that 28.4 percent of British adults paid for an audio-streaming subscription in 2019, up from 25.9 percent in 2018 and 18.9 percent in 2017. This suggests that the point at which the U.K. reaches so-called streaming saturation — when the totality of those willing to pay for streaming are doing so — may be further off than expected. This is particularly important when you consider that the U.K. is widely thought of as a “mature” streaming market: Spotify first fully launched in the U.K. in 2009, two years before it arrived in the U.S.
However, there is also a note of concern raised on this topic in All About the Music: According to BPI stats, the U.K. record industry’s wholesale streaming-subscription income in 2019 was up by £101.2 million (to £568.8 million) year-on-year, a significantly lesser rise than the £121 million gain seen in 2018 — adding to the evidence that streaming-subscription growth is slowing down in the world’s biggest markets. On a brighter note, the Kantar survey suggests that 47.6 percent of U.K. consumers spent something on recorded music in 2019 — either via a physical/digital purchase or by holding a subscription-streaming account — up from 45.6 percent in 2018 and 44.5 percent in 2017.
The big question, then, for record labels now: How can a fast-maturing streaming market like the U.K. tempt, say, 40-to-50 percent of music consumers to specifically spend money on a monthly streaming subscription without damaging the market’s optimal commercial growth?
3. Hip-hop keeps rising in the U.K. — but isn’t yet its biggest genre
The reign of hip-hop in the United States isn’t going anywhere: According Alpha Data’s annual report, the genre (“hip-hop/rap”) claimed six of the Top 10 biggest streaming tracks in the U.S. last year — and a stunning 52 percent of the Top 100.
In the U.K., hip-hop isn’t soaring to quite these heights, but it’s certainly holding its own. Propelled by the popularity of British artists such as Stormzy and Dave, some 21.5 percent of chart-eligible singles sales in the U.K. in 2019 were categorized as “hip-hop/rap,” according to BPI stats. (Singles “sales” here count both downloads and streaming.) That 21.5 percent market share represented a decent climb over the prior year (20.9 percent) and 2017 (15.4 percent). In fact, it was nearly double the market share that hip-hop/rap claimed as recently as 2015 (11.0 percent).
Pop, however, remains king of the U.K. singles chart, keeping hip-hop in the second spot. Pop claimed a 33.1 percent market share of singles “sales” in 2019, according to All About the Music, up from 32.2 percent in 2018 (but down from the 36.5 percent it claimed in 2017).
The genre that has lost the most market share over the past five years in the U.K.? Dance/Electronic, which claimed 15.4 percent of singles “sales” in 2016, 11.6 percent in 2017, 9.5 percent in 2018, and only 9.1 percent in 2019. That means dance music pulled in less than half the sales/streams volume of hip-hop in 2019 in the U.K. last year, and less than a third of pop music.
Tim Ingham is the founder and publisher of Music Business Worldwide, which has serviced the global industry with news, analysis, and jobs since 2015. He writes a weekly column for Rolling Stone.