International Licensing and MK presentation

1. Spain MUSIC MARKET ANALYSIS Julio Rodriguez-Lavin ID: 09037075

2. Spain Member state of the European Union. Government: parliamentary democracy under a constitutional monarchy. Population: 46.7 millions. GDP per capita: US$ 33,700. The 9th largest economy in the world. Capital: Madrid. Religion: Roman Catholicism (76%). Language: Castilian (Spanish), Catalan, Euskera and Gallego. Current rate of unemployment: 20.5%

3. Music Business scenario Spain is the 10th largest record market in the world. One of the worst-performing markets in Western Europe over the last 5 years. From 2005 to 2009: European sales fell by 23%. Spanish sales dropped 43%. The market is 38% of its value in 2001. *(IFPI, 2010)

4. Music Industry features The “Big Four” control the 91% of the market. The rest of the pie (9%) is divided among the independent labels. *(FEDEA, 2010)

5. Main industry bodies Promusicae is a trade group representing the Spanish recording industry. Its main goal is to defend the interests of Spanish music producers. SGAE is the main collecting society for songwriters, composers and music publishers in Spain. It is similar to ASCAP. The sound of Spain: platform created to support the Spanish music at the international markets. Special trade missions: New York (07-08), Beijin (08) and Mexico (09). It has attended the most important international meeting points, such as Popkomm (Berlin) or Midem (Cannes).

6. Music Industry Features Main magazines Revista 40 Principales Rolling Stone Radio 40 Principales Cadena Dial Cadena 100 M80 Radio 3 TV 40tv 40 latino MTV Sol musica *(PRISA)

8. Music video

9. Recorded music sales trend 2009 US million *(IFPI, 2010)

10. Online piracy A total of 8.6 million* users are engaged in illegal file-sharing. 32% of Internet users frequently downloading illegal music from P2P sites. More than double of the European average (15%)*. Recently, a new report from IDC Research showed that 96% of all recorded music acquired online in Spain is pirated (2010). Main causes: 29.1 million Internet users (72% of the population). Economic recession. Legal vacuum. Physical piracy rate has dropped to 10% in 2009 *(IIIPA 2010)

11. IMPACT In 2009 total value of the market set at $246 millions (-14,3%). “For every ten copies bought in Spain at the beginning of the decade, today's fans will take home only three” (Economista, 2010). Decline of investment Repertoire While 10 domestic new acts would be signed by a major in 2005, today only 3 or 4 are signed. In 2009, no presence of new acts on the top 50. *(IFPI, 2010)

12. Best selling albums 2009 Only the top 3 acts managed to sell more than 100.000 copies Certification *(IFPI, 2010)

13. Response to the current scenario Government developed “The Sinde Law” A provision aimed to regulate copyright and intellectual property rights on the Internet. Websites offer illegal material to download will be targeted, through a Commission (IPC) depending on the Culture Ministry. Legal vacuum Previous cases judges argued P2Ps do not infringe the law, because content is shared without a “commercial profit”. The law allows to make private copies of copyrighted work without the author's consent for published works if the copy is not for commercial use. The provision is in “limbo” until next year

14. Live music: good news In 2009, live music reached a profit of US$ 367.4 million vs US$ 246 million from the recorded music sales. In 2000 21.8 million viewers while in 2008 more than 33 million. In 2000, 71,045 concerts took place in Spain, whilst in 2008 the numbers doubled to 144, 859 concerts. During the same period, ticket’s price has raised 75%. *(IFPI, 2010)

15. The future Physical sales will keep dropping during 2010 (A recent research shows -12% duringthe 1st semester). Live music revenues will not grow due to the economic hardship. Less investment = more difficult to develop new talent= no international acts. Established acts are focusing on other territories (Latin America/North America). They are adapting these international patterns to succeed. Legal solution on the way?

16. Thanks!!!!!! ANY QUESTION? Gracias!!!!!!

17. References Chacón, F. (2010) Los conciertosmueven en España 275 millones, El Mundo, 24 Feb. 2010 [Online] Available from http://www.apmusicales.com/PDF/Clipping%20prensa%20X%20Aniversario%20APM.pdf [Accessed 13 Nov. 2010]. El Economista (2010) La venta de música en Españacayó un 17% en 2009, El Economista, 21 Jan. 2010 [ Online] Available from http://www.eleconomista.es/noticias/noticias/1850416/01/10/Cae-un-17-la-venta-de-musica-en-Espana-que-esta-en-cabeza-en-pirateria.html [Accessed 10 Nov. 2010]. FEDEA(2010) Informesobre la industria de la música 2010 [Online] Available from http://www.fedea.es/ [Accesed 18Nov. 2010] IFPI (2010) Digital music report 2010 [Online] Available from http://www.ifpi.org/content/library/DMR2010_KEY_HIGHLIGHTS.pdf [Accessed 10 Nov. 2010]. IFPI (2010) Recording Industry in Numbers 2010, IFPI: London IFPI (2009) Recording Industry in Numbers 2009, IFPI: London IIPA (2010) Special 301 Report on Copyright protection and enforcement [Online] Available from http://www.iipa.com/countryreports.html [Accessed 8 April 2010]. Llewellyn, H. (2010) Spanish Online Piracy Rate Nears 96%, Billboard, 2 June 2010 [Online] Available from http://www.billboard.biz/bbbiz/content_display/industry/e3i4811cd742d860d933faa7d0f818f0a7a[Accesed 18Nov. 2010]. Ministerio de Economia y Hacienda (2010) Proyecto de Ley de Economiasostenible [Online] Available from http://www.economiasostenible.gob.es/wp-content/uploads/2010/03/01_proyecto_ley_economia_sostenible.pdf [Accessed 15 April 2010]. Pormusicae(2010), Sound from Spain, 8 Oct. 2010, [Online] Available from http://www.promusicae.org/espanol.html [Accessed 13 Nov. 2010]. Rodriguez, S. (2010) Cierre de 'webs' por la puerta de atrás, El Mundo, 19 March 2010 [Online] Available from http://www.elmundo.es/blogs/elmundo/catalejo/2010/03/19/cierre-de-webs-por-la-puerta-de-atras.html [Accessed 13 Nov. 2010].