REACTIVATING THE AFRICAN MUSIC DOWNLOADING MARKET
Around 2012 there was a lot of excitement in the Nigerian music space where a number of companies were being established with the sole…
Around 2012 there was a lot of excitement in the Nigerian music space where a number of companies were being established with the sole purpose of disrupting traditional music distribution channels and capitalising on the anticipated growth prospects of digital consumption of music.
These companies, such as Spinlet, iRoking and others were attempting to spark the revolution of (legal) digital downloads which, it was hoped, would go a significant way in curbing the piracy problems the music (and overall creative) industries were grappling with at the time, both online and offline.
However, given the fact that most consumers in the market were still very much beholden to the traditional modes of music consumption — through which there was a lot of leakage in terms of sales revenues — coupled with the (relatively) high cost of internet data (a necessary cost of consuming music via the channels of these technology companies), these companies struggled to gain traction and eventually had to pivot into other/additional areas, or seemingly became dormant.
Ironically, shortly after this initial push Apple began to expand the territories in which its iTunes store would be available and this expansion included Nigeria. Thus Apple — through significant marketing and provision for accepting payments in the local currency — began to cultivate a (legal) downloading culture which, although not yet pervasive enough to be deemed to have achieved critical mass in terms of penetration, has seen a significant increase in the number of Nigerian consumers that now regularly purchase music of their favourite Nigerian acts through the platform.
Thus, in light of recent murmurings of Apple planning to shut down its iTunes store altogether — in order to focus solely on its streaming division — this has inadvertently presented a significant opportunity for local downloading platforms to step in and carry on where they left off. Apple, having done a lot of the (expensive) leg work of conditioning Nigerian music lovers to consume music through legal online distribution channels, has, metaphorically speaking, ploughed the land and planted the seeds from which a 500m+ user market for music downloads across Africa can and will grow.
It is for local players, be they the early pioneers or new entrants, to nurture and develop this new consumption culture thereby capitalising on the ground work laid by Apple.
However, a key factor that must first be considered is whether Apple — in its bid to encourage streaming across Africa — will partner in some way with local telecoms providers to introduce some form of “zero rated” bundling with the aim of reducing the costs of data to the lowest possible point for consumers that choose to use their music streaming platform. This would bring the risk of such services “cannibalising” the download market as was found to be the case in the European, UK and US markets.
Regardless of whether or not such a deal is reached, there would still be a long period of adjustment and transition before streaming becomes a mainstream channel of music consumption in Nigeria due to the general instability of mobile networks currently — save for in some pockets of Lagos and Abuja.
Thus it is still extremely worthwhile for local online music retailers to prepare strategies for picking up where Apple left off in terms of the music downloading market.
Arguably, the best positioned players to fully exploit this imminent opportunity are the MNOs themselves, and in particular MTN with its Music Plus offerings. I have written before, here, about the potential power of the telcos to corner the Nigerian/African music market and (officially) take on the mantle as THE biggest distributors of music on the continent. Nonetheless, players independent of the telecommunications sector also have an opportunity to cash in on the potential windfalls.
For example Boomplay, one of the leading platforms in this space, recently announced it had reached the milestone of one million downloads of its app, with almost half a million monthly users and fast closing in on its longer term target of 1 million daily users. Add the fact of the platform’s payment innovations (through its exclusive Boomplay coins as a mode of payment for music on its platform) the possibilities begin to come into view.
Another example is Spinlet, one of the pioneering players in this field, who will also be presented with a major opportunity and would thus be well served recalibrating the infrastructure it was putting in place all those years ago; infrastructure such as its Java script-based mobile app, SMS payment portal capabilities, and others that will enable it consolidate on its prior investments and move to the next level in the marketplace.
These businesses, and potential new entrants to the market place, have a great opportunity to consolidate on the gains made by Apple’s iTunes franchise on the continent and must be poised to build on said gains if and when any such opportunity arises.