YouTube Steals the Show at Midem’s First Latin American Conference

YouTube is winning the music streaming battle for Latin America, which is growing twice as fast as the rest of the world, according to data released in Rio de Janeiro on Monday by MiDIA Research, at the first-ever Latin America forum for Midem.

From 2013 to 2017, while the global streaming market grew at a rate of 91 percent annually, streaming as a whole more than doubled — 186 percent — in Latin America.

“Latin America — particularly Brazil and Mexico — are test cases of the global streaming market,” said Zach Fuller, a MiDIA analyst who delivered the data.

Driving the stunning streaming growth in Brazil, the region’s largest market, are ad-supported streams from YouTube, though Spotify and Deezer, who have aggressively partnered with local cell providers to offer streaming bundles, are contributing as well. The packages are helping to overcome a relatively low penetration of credit-card users.



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Just in 2017, Latin America saw a 49 percent jump in streaming revenues, buoyed by an 18 percent uptick in Brazil. “Going from 2017 to 2018, nothing can match what is happening with Latin American music,” Fuller said.

While Peru, Colombia, Chile and Mexico are growing faster, it is Brazil, in spite of its economic woes, that is in the laser sights of streamers like Spotify and Deezer, who have been operating the country since 2014 and 2013, respectively.

Only 52 percent of Brazilians are using credit cards, up from 35 percent in 2013, according to the country’s Central Bank. More important to the digital music players: there are 220 million cell phones in the country, Fuller said — well more than its 209 million citizens.

Brazil and its neighbors are catching up to the rest of the world in digital-music penetration after a disappointing early experiment by Apple with downloads. When Apple launched its iTunes store in Brazil in late 2011 it did it in English, with prices in dollars and only accepted international credit cards. “So it made it only for the elites, and that model didn’t work in Brazil,” said Leo Morel, a Brazilian analyst for MiDIA.

“Before the advent of smart phones and streaming it appeared like there was little impetus for the record industry to pay as much attention to Latin America,” Fuller said.

Despite impressive growth by Spotify — Latin America was its fastest-growing ad-supported segment in the third quarter — it is YouTube that is dictating the growth trajectory.

Latin American artists had 13 of the 40 most-viewed music videos uploaded in the world since 2016, Fuller said. “That is an incredible statistic and is likely to drive growth in the future,” he said. “YouTube has effectively become bigger and better at making these hits.”

Brazil’s rapid streaming adoption was one reason why Midem, the French b2b music industry market, chose Rio to host its two-day forum. The invite-only event features panels with artists and industry professionals, and nightly concerts with Brazilian artists and some discovered by Midem in other developing countries, like Cameroon.

On the forum’s first day, a panel also explored the internationalization of Latin American music. Sync executives and indie label heads stressed the importance of landing syncs in movies, TV shows and video games as a way to launch Latin artists.

“It is important that we identify particular TV shows and series on Netflix and Hulu and Amazon,” said Mary Nunez, the VP of Synch for Warner/Chappell Latin. “A lot of artists want to be discovered in a more organic, authentic placement, and sync is a wonderful place for that to happen.”

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Grant Dull, the CEO of ZZK Records, a Buenos Aires-based electro-cumbia label, recounted how one remix by Chancha Via Circuito that was synced for AMC’s “Breaking Bad” changed the artist’s fortunes. “All of a sudden he became a star in Argentina and he is known for that scene where Walter White is burying his money in the desert,” Dull said. “For Chancha, it was a before and after.”

Video games, especially internationally popular titles like FIFA Football/Soccer, are also a key platform, said Daniel Zawadzki, partner and head of new business development at M3 Music, a Colombian indie label. “Those video games are well-curated,” he said. “So not only are you going to have your track there with a really cool video game but you are also going to be with other great artists in that game, so the word of mouth keeps growing.”

Nunez, in discussing how to emulate the trajectory of Rosalia, the Spanish flamenco singer that crossed into urban music, bristled at the “crossover” label. “I think we have already crossed over,” she said. “I don’t think we should be using terminology that is from 20 years ago. This is our moment.”

The recent Lollapalooza lineup in Chile, for example, features Juanes, Kendrick Lamar, Rosalia, Tiësto, and Arctic Monkeys. “The crossover already happened and now there is no formula for an artist,” Zawadzki said. “Everyone has to work on their own craft.”

But every artist can use a break. In the day’s final panel, two members of Brazilian metal band Far From Alaska recounted the story of how they rose from obscurity in Brazil’s Northeast.

It started with a bit of fandom. After being invited to play at a festival in Sao Paulo in 2012, the band’s synth player, Cris Botarelli, tracked down Shirley Manson, the lead singer of Garbage, in a hotel lobby. “She was so sweet,” Botarelli said in an interview on Monday. “I didn’t even have any music to give to her, it was like our second show.” Three months later, Manson woke up one day with the name of the Brazilian band in her head and went on YouTube, said Emmily Barreto, FFA’s lead singer. Manson wrote a long post on Facebook praising the band that went viral.

Then two years ago, Midem’s “artist accelerator” program effectively launched the band in Europe. At Midem’s 2016 edition in Cannes, the band mates participated in workshops with industry executives and then performed at a concert on the beach. There they were approached by Damien Chamard Boudet, a promoter with Live Nation, who invited Far From Alaska to play on the main stage at last year’s Download Festival in Paris.

“There were 30,000 people there and they were all singing our songs, which was amazing,” Botarelli said.


Brazil’s music boom: streaming, Sertanejo, Anitta and more


Brazil currently has more active smartphones than inhabitants.

According to Getúlio Vargas Foundation, there are 220 million mobile phones in operation in the country and 207.6 million inhabitants. Factor in computers and tablets, and Brazil is expected to reach two portable devices per citizen by 2019.

This is part of the backdrop to a remarkable growth in revenues for Brazil’s recorded-music market, which grew by 17.9% in 2017 including a 64% rise for streaming revenues.

Despite a severe economic and political crisis – and also great social inequality and the low acquisition power of the majority of its population – Brazil currently displays a great potential to become one of the world’s major music markets in the near future – it was ninth in 2017 according to the IFPI’s Global Music Report. Streaming services from YouTube and Spotify to Netflix are growing their user-bases rapidly.

Sertanejo, Brazil’s equivalent of country music, which is related to agribusiness, is currently the most popular music genre in the country. Artists such as Wesley Safadão and Luan Santana are among the top-grossing live acts, while investors who have never worked in the music business have started to search for prominent talents to invest and profit.

Even with sertanejo’s current market dominance, Brazil presents a great diversity in terms of music styles, and its consumption has been increasingly complex – but also understood.

Culture in Capitals, a survey recently published by JLeiva Consulting in partnership with Datafolha Survey, identified the cultural habits of 10,630 Brazilians over twelve years old in twelve Brazilian cities, such as São Paulo, Rio de Janeiro, Salvador and Porto Alegre.

The study points to going to the movies as the most preferred cultural activity in the country, according to 64% of the interviewees, followed by live shows (46%). Sertanejo is the most popular music style in the country, followed by Brazilian popular music (also known as MPB), rock, gospel music, pagode and pop music.

Among the twelve cities surveyed, sertanejo leads in half: Belo Horizonte, Brasília, Curitiba, Manaus, Porto Alegre and São Paulo, forró leads in Fortaleza, Recife and São Luís, and MPB leads in Rio de Janeiro.

55% of 12-15 year-olds stated that Brazilian funk music is the music style they prefer the most. This number drops to 28% for 16-24 years olds. Moreover, the 16-24 age group prefers to listen to pop music (28%) followed by rock (26%), while Brazilians over 25 years old prefer sertanejo, MPB and gospel music.

MPB and rock are the music styles that economically-privileged Brazilians preferred the most. Gospel and sertanejo are the leaders among the C, D and E Brazilian social classes. Economic conditions, it appears, determine the music style that Brazilians consume.

This has created an environment that some music-industry experts see as the launchpad for Brazilian pop music to become the next big trend, in the near future. Singer Anitta has been seen as a case study in how to use effective marketing strategies to develop such an artist’s career, including brand partnerships (in her case, with telco Clara).

Under her baptismal name of Larissa de Macedo Machado, she made a name for herself in Rio de Janeiro’s funk music scene when signed to independent label Furacão 2000, before becoming popular in Brazil in 2013 as MC Anitta with the song ‘Show das Ponderosas’ (‘Powerful Girls’ Show’).

It was at this point that she signed with a major label (Warner Music), dropped the ‘MC’ from her artist name, and began to combine Brazilian funk beats with other rhythms, such as pop, to become more popular in Brazil.

Recently, Anitta decided to spread her music career overseas, and recorded some songs in English and Spanish featuring internationally popular artists such as Iggy Azalea, Maluma, J Balvin and Alesso. This strategy has propelled her into Spotify’s global Top 50 and for the first time in Billboard’s US charts. Moreover, she has also been invited to give interviews on radio and TV shows in the United States and South American countries.

Anitta is currently the most prominent Brazilian artist overseas, following the footsteps of artists such as Xuxa, João Gilberto and Tom Jobim. The success of Anitta has fomented the interest of major labels to invest in Brazilian funk female artists such as Ludmilla and Karol Conka, whose lyrics also focus on topics like female empowerment.

Despite the development of new music consumption formats, such as music-streaming, traditional communicational vehicles such as TV and radio have still a great importance in the Brazilian music market. Even with the growth of smartphone ownership and the popularity of platforms such as YouTube, mainstream artists like Anitta and Luan Santana still get plenty of marketing investment to maintain their presences on TV shows and radio stations.

Leo Morel

Originally published at

Spotify’s Tencent Risk

Music Industry Blog

NOTE: a previous version of this post referred to a non-compete clause with Spotify detailed in this SEC filing. I have been advised that the scope of this clause is narrower than I had originally interpreted. I have therefore updated this post to remove reference to that clause but the essence of the post remains intact due to the potential role of the major labels which, as outlined below, could have the same effect as a non-compete clause.

On Thursday (September 20th) Spotify grabbed the headlines with its announcement that it is launching a free-to-use direct upload service for artists. While it is undoubtedly a big move, and one that will concern Soundcloud among others, it was not a surprising move. In fact, in April we predicted this would happen soon:“Spotify will take a subtler path to ‘doing a Netflix’, first by ‘doing…

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How Streaming is Changing the Shape of Music Itself [Part I]

Music Industry Blog

[This is the first of two thought pieces on how streaming is reshaping music from creation to consumption] 

The streaming era has arrived in the music business, but the music business has not yet fully arrived in the streaming era. Labels, publishers, artists, songwriters and managers are all feeling – to differing degrees – the revenue impact of a booming streaming sector. However, few of these streaming migrants are fundamentally reinventing their approach to meet the demands of the new world. A new rule book is needed, and for that we need to know which of today’s trends are the markers for the future. This sort of future gazing requires us to avoid the temptation of looking at the player with the ball, but instead look for who the ball is going to be passed to.

Where we are now

These are changes that represent the start of the…

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Tech Majors Market Shares Q2 2018

Music Industry Blog

The tech world has no shortage of acronyms for the big tech companies (GAFA, GAAF, Fang, the four horsemen…). At MIDiA we like to keep things simple, just like the major record labels and major TV studios we call the big four tech companies the Tech Majors. Each quarter the MIDiA team deep dives into the financial filings of Alphabet, Amazon, Apple and Facebook to create our quarterly Tech Majors Market Shares reports. (The Q2 edition is available to clients here.). In these reports we focus on the metrics that are most important for media and content companies. Here are some highlights of our latest report.

tech majors market shares q2 2018 midia research

Tech major Q2 2018 revenue totalled $152.1 billion, down from Q1 2018 – $155.3 billion –  but up 28% from Q2 2017 and 51% from Q2 2016. These growth rates mirror the year-on-year Q1 growths for 2016, 2017 and 2018. The tech…

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Emerging Music Markets: Streaming’s Third Wave

Music Industry Blog

MIDiA has just published a new report that deep dives into how streaming is, or in some cases is not, lifting off in emerging markets. The regions we focused on were Russia, the Middle East, sub-Saharan Africa, China and India. The report ‘Emerging Music Markets: Streaming’s Third Wave’ is immediately available to MIDiA subscription clients and can also be purchased, along with its full dataset (including service- and country-level subscriber and free users numbers, as well as consumer data for India and China) on our report store here.

Here are some of the key findings and themes of the report.

emerging markets midia streaming

With streaming growth set to slow in mature western markets by 2019, the next wave of fast growth will come from a mixture of mid-tier markets such as Mexico, Brazil, Japan and Germany. The lower income mid-tier markets such as Brazil and Mexico are so populous that the urban elites…

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Music Industry Blog

Unless you have been on Mars for the last couple of days you will have seen the news that Luis Fonsi’s ‘Despacito’ has become the most streamed track in history with 4.6 billion streams. The figure includes a couple of versions of the track (ie the one include a certain Justin Bieber) but is an impressive tally nonetheless. The landmark raises 2 key trends:

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Latin Takeover

On the first point, Latin America is becoming a streaming powerhouse. This is a trend we have long anticipated at MIDiA and it is why we have a Latin American analyst (Leo Morel in Brazil) and have been fielding consumer surveys in the region since we launched the company. ‘Despacito’ is not an isolated event. For example, Shakira’s ‘Chantaje’ became the first Latin American Spanish language track to reach 1 billion views…

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