Taming the “Wild West” of Zambia’s Music Industry
I will begin by first stating that the title was brought up by my co-founder Twaambo while on a road trip. He was very excited at the time to the point that he badgered me to write about what we had and experienced so far in the Zambian “music industry” for the next few months. Hopefully this gets him off my back.
Before I get into the article in detail, the first question that came to mind is, what is the “Wild West?” If you happen to Google that term you will find a Wikipedia entry about the American frontier including what I found of interest; 5 myths of the Wild West. Of course the main imagery conjured up by that term would be cowboys and for some strange reason the good, the bad and the ugly came to my mind.
Now onto our own “Wild West”. When we first embarked on this journey (to set up an on-line platform to sell Zambian music), we really did assume that a lot of things would be in place or certain infrastructure already existed. I will get into the “a lot” briefly, a lot.
So there are a number of areas which we came across that gave us headaches despite the fact that our own project only focuses on one area, sales, we encountered the following…
1. Infrastructure
“Why is it we’re one of a few countries in the region without a platform selling or streaming music on-line?” This was a question that baffled us for about 5 years. Up until we launched at the beginning of last year, the only access artists or publishers in Zambia had to put music on-line on services such as iTunes, Google Play, Spotify etc was through music aggregation services like CDBaby, Tunecore and others like them.
Get the music onto these services however is a complex task. It means getting a third party (either family or friend) living in one of these countries where these businesses are based to help you get the content on-line. This is because of the fact that these services can only remit funds generated from sales in the countries where they’re domiciled or recognised in most cases.
2. Free Downloads & the Fans
Due to the lack of or the ability for the majority of artists to put music up for sale digitally and the decline and subsequent demise of CD sales in the late 2000’s; for most artists to stay “relevant”, the advent of giving music away for free became the norm in Zambia. The rationale (based on some discussions we had with numerous artists) was that giving music out for free would result in getting more airplay because their fans would ask/request for their music to be played on-air which would in turn result in getting shows and get well… “famous”.
Granted this has worked to some degree for some artists, we still wondered how artist costs were being met. Studio time needs to be paid for or if the studio is self owned, how much was spent setting it up? Transportation to and from the studio, phone airtime, food etc all add up and we really wondered if these costs could be truly recovered only through performing in Zambia.
The next question became, “how much are artists making from these shows anyway” as most of them happen at clubs or venues not necessarily charging the fans or consumers. Some of the figures we were told weren’t encouraging but clearly survival for some artists was necessary
However one must look at the long term damage to the mindset change of the consumer which I will touch on now. As can be seen in the Facebook screenshot below, when Wezi decided to make one of her singles for sale only with no free option, there was a great deal of push back.
It seems that most of the consumers or fans of music now feel “entitled” to get it at no cost whatsoever.
There is clearly a disconnect among some as to what goes into putting music out. So here is a crash course: Recording, tracking, mixing and mastering, photography, and artwork are all items that need to be taken care of from the artist’s pocket. If an artist goes the physical copy route then one has to add to that list pressing & packaging. All of the above cost quite a bit of money if one is to actually deliver a quality product to their fans.
3. Streaming vs. Buying
“Why aren’t you a streaming service?” is the question that came up numerous times so I figured why not address this too. There are a few things that lead to our decision to sell rather than stream and they are as follows:
a. Data costs
Based on the opera data in terms of usage, it was clear that streaming, especially in Zambia would be a challenge for the majority of the consumers as this is our primary market as can be seen by the opera report(PDF link).
b. Does it make business sense?
For those who are unaware, none of the big streaming platforms have become profitable since they launched to present. Granted if you look into them in more detail, there are historic issues regarding when the streaming services signed with the big publishers to get the music onto their platforms. In a nutshell, the streaming services paid a huge amount of money upfront to the publishers for the music which meant that for revenue to grow and eventually become profitable, the services needed more and more subscribers. However even as the subscriber base for the majority of the streaming services has grown, the losses have continued as can be seen in the following articles:
- Spotify financials showed a net loss of US$2 million in 2016
- Pandora made a net loss of US$343 million in 2016
- Tidal closed 2015 US$28 million in the red
- Soundcloud made a well publicised loss of US$54 million in 2015
There is little information for the other big players in the market but they would also suffer the same fate based on the historic terms signed with the most powerful music publishers
Granted, in servicing the Zambian music industry, we do not have the problem of upfront licensing payments to major artists or publishers like the streaming companies mentioned above. What is clear however is that creating and thereafter growing a subscriber base would be a big undertaking as a bootstrapped startup; it would mean we would be operating at a loss for a long time while without the tens of thousands in the bank that it would take to keep operating our company, let alone the millions of dollars it takes to operate on the level of the popular streaming services of the world.
Quite simply in the Zambian environment; we don’t have millions in the bank to float a streaming business until it one day hopefully takes off.
c. Development
“Bootstrapping,” a term which according to its Wikipedia entry originated in the 19th century and heavily used in the start up world is going to be seen a lot now (maybe). As we are a three person team i.e. two men and one lady aka our media ninja, to get a MVP to market while bootstrapping meant we had to go down the route of sales rather than streaming ie the development cost related to a streaming service were out of our reach and as we discovered with the law (see point e below), there are no laws regarding streaming music and how it is managed in Zambia so in effect, we were stuck with selling music only.
d. Self managing
The majority of artists are self managed meaning that everything related to their business dealings rests on their shoulders. As much as this is the case all over the world, it’s definitely a bigger problem here even for well or seasoned ones.
Out of all the 71 artists and publishers we have met so far (from December 2016 to December 2017), we have only dealt with 6 managers (8 in total including those not signed up yet) out of the 43 artists and publishers we have signed up onto our platform.
This led to various challenges for us in terms of scheduling appointments. From the initial contact to signing terms took an average of 28 days. From signing to getting content from those that had a back catalogue took an average of 18 days which involved follow up effort of up to 5 times.
Coupled with that, it was interesting to discover the amount of music we received that wasn’t at the right bitrate for our requirements or how many song/s were not tagged with the correct meta-data or even that sometimes songs were missing from projects (shocking right?). It appears that archiving & storage of music was also a problem for most. This leads us to conclude that there is a rush to “produce” and put music out without the necessary additions of meta-data or proper storage of music being considered. This is something however we believe can be fixed by all the artists and publishers by them being more disciplined and implementing more processes around the final production of their music.
e. The law
Oh boy, where to start? Regarding the law, we discovered early on that Zambia’s copyright law, first written in 1993 and enacted into the law of the land in 1994 (Copyright and Performance Rights Act, 1994, Act №44 of 1994) and amended slightly in 2010 (Copyright and Performance Rights (Amendment) Act, 2010, Act №25 of 2010), has never been fully updated since enactment. We were honoured to meet the man who wrote the original document in 1993, Dr OMM Banda and had a good laugh as to how come things have never progressed legislature wise.
Sadly, while the law made perfect sense and was relevant back then it does not cover anything in our predominantly digital world of today. In a nut shell, the law never kept up with the times and the advent of todays modern technology. This is when the laughter in our meeting died down and things took a more serious tone. Further amendment is certainly required and can’t be done soon enough in our opinion.
When we entered the market our goals & vision as a company was and (we assumed) would only be centered around fixing or building as it turned out a missing piece of the “music industry”. Things began to look a lot more complicated.
If It’s Broke, Fix It
So how do we collectively tackle these various issues? Firstly we must engage with various stakeholders (which by the way is probably one of the most widely used words in the country).
There has to be a systematic tackling of the various issues mentioned earlier in the article and we’ve got it covered:
1. Infrastructure and the fans
Granted the world, in terms of how fans of music consume this content specifically, has changed; streaming is definitely the most convenient method of consuming music today. In our case we had to start from somewhere, sales (our reasoning can be seen earlier in this article).
By slowly changing the mindset which has beset the industry (both artist and fans) for way too long, the consumer needs to start paying for music regardless of how it’s consumed and the artist needs to realise that they can make money off sales or streaming revenues as well.
We do firmly believe that by trying to change the mindset of the fans to understand that they need to pay for the music, this will allow the artist to get better equipment if they own their own studio and thereby produce better quality music which would in turn translate in charging more and getting better shows or even hosting shows themselves (#FillUpTheX type things which will be discussed in another article) or if they don’t own their own studio, be able to slowly pay for better producers & etcetera.
2. Self Managing
With the extra revenue stream from sales, we do believe artists could then get a manager. As we noticed in trying to meet up with numerous artists/publishers, between recordings, marketing, practicing, interviews etc, getting a manager would certainly take some load off the artist with the idea that over time an entire team can be built but getting a manager is the beginning of building the team and is a major key.
3. The Law
Without a doubt, these need to be brought into the 21st century. Our law has lagged behind for too long while the technology has advanced incredibly. An update to incorporate how music is protected including copyright needs to be covered. Additionally; there are issues of trademarking that currently do not cover services in Zambia that also need to be enacted into law that will help with branding of services on-line and is hugely important especially in an environment where the internet has made the world “smaller”.
4. Further Development & Streaming
So the question still remains, “why not a streaming service”? It will take some time to get there or pivot towards that at this point. One of the biggest issues out of our control sadly is the cost of internet data which is and will possibly be the biggest issue for the majority of our customers on the continent as i touched on earlier (granted a war on pricing has helped reduce the price recently). Until this significantly improves, sales would be the best way forward especially for the artist to generate meaningful revenue. We could not ignore our primary market and focus on consumers where data is not an issue but “charity begins at home” so we will continue to serve our primary market first and hopefully things will change over time.
Further, artists still have to consider whether streaming is a good business proposition for most of them when considering their immediate market. To put things into perspective, to our knowledge; the per stream payout on Spotify for example is $0.0038 (see image above). Which means even by simple mathematics for an artist to generate any meaningful revenues they need their number to be in the hundreds of thousands to millions of streams. Unfortunately for most artists in Zambia & many on the continent with similar conditions to a larger extent they don’t have the numbers so sales is still possibly the most ideal means of revenue generation.
With all the above solutions, we believe that over time we may be able to finally tame the “Wild West”!
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