CreativeEconomies

Focus: The Music Industry

Switzerland as a country with both richly faceted and lived traditions in the field of music.

In 2015, the Swiss music industry had around 32,000 employees, who were employed in around 11,000 businesses. With a share of over 11 % of the Swiss creative industries, the music industry is one of the most important submarkets in terms of employment. While the number of businesses and employees increased over the two-year period 2013 / 2015, gross value added and total turnover declined. The question of sustainable business models and exploitation models remains relevant. Digitisation is a key driver in this sector.

Music Industry Map

Music Industry 2015

Voices from the performing arts market

Turnover from audio and video streaming increased by 50 % to CHF 34.4 million and thus contributed 39 % to the total market. On the other hand, the decline in the download business, which still amounted to CHF 18.1 million (- 17 %), continued and thus already fell well short of the streaming segment.

“It’s impressive how fast the digital market is taking over: While streaming generated hardly any revenue five years ago, in 2017 it was practically the same as downloading in 2012, its best year”

Ivo Sacchi, President IFPI Switzerland and Managing Director Universal Music Switzerland. Source: Press Release, IFPI Schweiz; Date: 9 March 2018

International organisers are pushing into the market and increasing regulatory requirements are a concern for SMPA members.

Source: Press Release, SMPA Schweiz; Date: 23 May 2017

Last year, SUISA earned CHF 6.1 million from online music usage, 10.7 % more than in the previous year (CHF 5.6 million). In 2016, streaming revenues overtook download revenues for the first time. SUISA still has a lot to do in terms of fair remuneration for originators on the Internet.

Source: Press Release, SUISA Schweiz; Date: 27 May 2017

But the new driving force is streaming. Listening to music online via a streaming app like Spotify or Apple Music has become so popular that it in turn ousts the downloading of songs.

Source: SDA/ATS; Date: 9 March 2018

It is no longer about selling an album, but about playing individual tracks as often as possible. To do this, they must be added to the playlists of streaming services such as Apple Music or Spotify, which are particularly popular with younger users.

Source: srf.ch; Date: 4 February 2018

Music streaming, popularised by Spotify, has been instrumental in the recovery of the music industry, subject to long chronic shrinkage. While sales of music downloads and CDs are falling rapidly, the streaming market is soaring: in 2016 it expanded globally by 60 %, accounting for around 30 % of the global recording business.

Source: Frankfurter Allgemeine Zeitung, Spotify macht ernst mit der Börse; Date: 5 January 2018

“The larger the digital share, however, the more important the refinancing of content in the digital sphere, i.e., every form of online use must be linked to licenses that are negotiated in the market.”

Dr. Florian Drücke, Chairman, BVMI Board. Source: Pressemitteilung: Deutscher Musikmarkt 2017, IFPI Deutschland; Date: 1 March 2018

The global recording industry is seeing modest growth after more than a decade of significant decline. Years of investment and innovation have begun to reward an industry that has shifted from adapting to the digital age, to driving it.

Source: Global Music Report 2017, IFPI International; Date: 2017