WIN report: Indies' global market share rose in 2016, now worth $6bn

Wintel 2017 – the second report produced for Worldwide Independent Network (WIN) – has today (October 23) announced new global market share analysis of the independent music sector. The survey was completed by 660 respondents including labels and distributors from 26 countries and the results represent the most comprehensive assessment of the global independent record label sector ever compiled.

In mapping the global market share of the independent sector at copyright, rather than distribution level, the report maintains it presents an undistorted picture of its true market value. It states that the claimed market share by major labels or companies owned by major labels in various territories around the world amounts to $1.2bn of revenue that should be attributed to the independent sector.

Key findings from this research include:

Based on rights ownership, the global market share of independent record labels has increased since 2015 by 0.9 percentage points to 38.4%, representing global revenues of $6 billion in 2016. This is an increase of 6.9% on the previous 12 months.

Although global independent label market share increased, changes at country level were as diverse as the market share picture itself.

The US saw the largest single swing in favour of independents, increasing 1.7 percentage points to 37.3%. South Korean independents further increased their grip on the Korean market, with strong results from leading independents resulting in total market share growth of 0.6 percentage points to 89.1%.

The independent share declined slightly in Japan, down 0.3 percentage points to 63.3%, with a number of leading local companies registering significant revenue losses in 2016.

Many European markets, including key territories such as the UK and Germany, saw independent market share fall slightly, despite overall revenue growth.

The report makes clear that digital music, and streaming in particular, continues to create exciting opportunities for independent labels and that in virtually every country, independent labels continue to record higher market share in streaming than they do in physical formats.

It is entirely down to streaming that the global recorded music market enjoyed its second consecutive year of growth (5.9%) in 2016. Prior to 2015, it had endured 15 years of decline.

Measured in isolation, streaming grew 60.4% in 2016. It now accounts for 59% of all digital revenues, whilst digital as a whole now accounts for 50% of the total market.

Independent label streaming revenues grew by 80.4% in 2016, reaching $2.1 billion, up from $1.2 billion in 2015. This growth was slightly greater than the 78% by which the entire market grew, so independent label market share of streaming revenues increased by 0.6 percentage points, up from 39.4% to 40% over the same period.

Speaking about the report, Alison Wenham, CEO of WIN said: “The WINTEL 2017 report tells the story of another strong year for the independent sector. It has seen solid growth overall and an astonishing increase in streaming revenues. Both are trends we are confident will continue. It is important when making sense of the global market for independent music that we continue to use ownership rather than distribution as the method of calculation. The claiming of market share through distribution by major labels distorts the true value of the independent market and creates a false picture of the amazing growth and vitality of our sector.”

Paul Pacifico, CEO of the Association of Independent Music (AIM) AIM added: “The music industry has always been driven by cutting edge companies run by innovative entrepreneurs. The Wintel report clearly shows that this holds true in the digital age. The Wintel report shines an important spotlight on the independent businesses, which together, make up over one third of the global music market and who occupy the most exciting, creative and compelling space in music both creatively and commercially.”

Key members of the independent sector have also joined in the discussion of the report, hailing the sector’s growth.

Martin Mills, founder, Beggars Group and vice president of WIN commented: “It speaks volumes for the tenacity, passion and entrepreneurship of independent labels, and the public’s desire for musical diversity, that even in these times of global dominance by major corporations, almost 4 out of every 10 dollars spent on music goes to the independent sector.”

Kees Van Weijen, president of IMPALA said: “The united indie community, its labels and artists show the diversity of its products in all genres of music world wide as presented in this Wintel report”

Helen Smith, executive chair of IMPALA added: "Statistics are vital. They punctuate the storyboard for the independent sector."

Richard James Burgess Ph.D., CEO of A2IM and vice president of WIN, concluded: “It is truly gratifying to see both U.S. and global independent market share increase again. We must continue to strive for a level playing field where the best releases rise to the top and where the digital services that respect copyright do not suffer unfair competition from those that co-opt our rights. Even as we celebrate we must remain vigilant. We are fighting our way out of a deep hole created by copyright abusers and we have a long climb to get revenues for creators and producers back to where they should be.”