New report puts Aussie indie labels at 30% revenue share, in Top 10 of global indie markets

The first market analysis commissioned by the Association of Independent Record Labels (AIR) shows that indie labels represent 30% of the revenues generated by the Australian recorded music market – a share that is much higher than previously thought.

The AIR Share: Australian Independent Music Market Report, released this morning and conducted by Deloitte Access Economics, estimates that the sector generated revenue of $154.8 million in 2014-15 and released over 6,000 singles and albums in that period.

The Australian recording industry as a whole had revenue of just under $399.4 million in 2014-15

Key findings of AIR Share are that:

• 44% of independent sector revenue comes from digital channels

• More than half (57%) of independent sector revenue is from Australian artists

• 95% of independent music releases is new content.

Australia is already ranked at #6 in the music markets according to the IFPI major figures.

But AIR’s 30% figure also puts the Australian indie sector in the Top 10 of the global indie list of primarily English-speaking music markets, said Alison Wenham, London-based CEO of WIN (Worldwide Independent Network).

Wenham was speaking exclusively to TMN while attending Brisbane’s BIGSOUND.

Comparatively the US indie market has a 34% share while the UK’s is 23%. Both markets are different to Australia’s.

In territories where English language records are not the norm, South Korea’s indie market is up to 88% while Finland’s makes up 16% on the other end of the scale.

Wenham emphasised how “crucial” it was that AIR’s study based figures on ownership of independent tracks rather than on their distribution, which skews figures towards major labels.

“Independent artists nowadays have a lot more options in how they enter the market,” Wenham pointed out.

The “ownership” approach emphasised the important role that independent labels play.

“They’re the ones who take the risks, they’re the ones finding nurturing and bringing to the market the new and most diverse acts.

“It would be hard to even imagine what the music industry would be like without independent labels.”

Last year WIN released the ground-breaking WINTEL report to analyse the global economic and cultural impact of the independent music sector.

By also putting the focus on ownership than distribution – Taylor Swift for instance comes under Universal’s figures although she is in fact signed to the indie Big Machine – WIN discovered that the indie labels’ share of the global market was 37.6%.

This was higher than the sub-30% that was thought, and in fact generated worldwide revenues of US $5.6 billion in 2015.

Chris Maund, of Mushroom Group of Companies states, “The independent sector is important for the industry, but also for the Australian community.

“We sign a lot more Australian artists then the majors, creating funding and opportunities for local talent.

“Also indie labels can afford to take more risks, and so ensure the diversity of music.

“Almost every new music genre in history, from hip-hop, grunge to trance, were launched from indie labels – with the passion and low overheads to take such risks.”

Deloitte Access Economics’ put the 2015 breakdown of indie digital revenues to 61% downloads and 29% music streaming.

“But this balance is shifting” it cautions. Realistically, in 2017 the figure would be more 60% streaming.

For Stu Watters, AIR’s Industry Adviser and Head of Government Relations – and previously long-time GM of AIR – a significant figure is that 30% of Australian indie labels’ revenue comes from exports.

He tells TMN, “In addition to figures that what a major role indies play in showcasing Australian content, it is also important to note that our independent sector is well represented and embedded in the global music market.”

Wenham agrees that exports are a growth market for Australian indies.

“The Australian figures are growing very sharply. Streaming is giving a more global reach, so it would be important that Australian labels would use more marketing tools and research in which territories their acts are actively being heard in and to work those markets.”

AIR’s data will be used to target government and corporate investment in the sector.

These could play a major role in globalising Australia’s independent sector.

Watters says AIR Share will collect figures annually, with future data to include breakdowns by state and genre.

The first AIR Share report will be available in print and online at www.air.org.au from 11am on Tuesday September 5.