IMS Business Report 2015 An annual study of the Electronic Music industry by Kevin Watson 1 IMS Business Report 2015 by KevinWatson.net The IMS Business Report 2015 covers five different aspects of the industry Music 1 Sales of tracks, albums and streaming by country DJs & Live Acts 2 Profiles of leading artists, including earnings and social media Clubs & Festivals 3 Popularity of festivals and clubs around the World Companies & Brands 4 Key players in industry, recent M&A activity and partnerships Industry Overall 5 Updated estimate of value growth of Electronic Music globally Hint: follow the sections through the report by looking for the starred number at the top of each page 2 IMS Business Report 2015 by KevinWatson.net 1 Music Dance share of US track sales in 2014 equalled all-time high, with even higher share of streams Electronic / Dance Music Share of Sales by Format (USA) • Dance’s share of digital Streams track sales is now 1.5x the level it was in 2011, maintaining the 4.6% first achieved in 2013 Digital Tracks • Album share slipped significantly in 2014, but this could well be a one- off Albums • In terms of streams, Dance significantly over- indexes, accounting for 6.8% in 2014 Source: Nielsen Music U.S. report 3 IMS Business Report 2015 by KevinWatson.net 1 Music In both the USA & Canada, Dance is the 4th most popular genre for streams – higher than Country Share of Streams by Genre (2014*) USA Canada • Dance accounted for 1 in every 10 streams in 29 21 Canada in 2014 • In the USA, total streaming across all 25 26 genres grew by 55% YoY, in comparison to album and track sales 21 27 which both declined >11% • Consumers listened to 7 10 an estimated 12 billion Dance / Electronic streams in North 6 5 America in 2014 Note: * For Canada, data from July-December 2014 only; 4 Source: Nielsen Music U.S. Report 2014; Nielsen Music Canada Report 2014; IMS Analysis IMS Business Report 2015 by KevinWatson.net 1 Music The official videos of the Top 9 EDM tracks in 2014 generated over 2bn views on YouTube Views & Likes Subscriptions Audiences 9 tracks on the Billboard Subscribers to EDM • EDM fans are more Top 100 2014 were EDM – channels grew likely to be online official videos of these significantly in 2014 • Consumers less than 25 tracks generated a huge years old view most number of views and likes EDM content on on YouTube YouTube • Those between 25 and 34 years old were the 2.3bn EDM segment with views highest growth in 2014 • Even interest in EDM on 8.4m YouTube amongst 35 to likes 49 year olds grew 80% last year 5 Source: Think with Google – ‘Have You Heard of EDM?’ report IMS Business Report 2015 by KevinWatson.net 1 Music Dance’s share of single sales in the UK reached an 8 year high in 2014 Dance Music Share of Sales by Format (UK) • Dance music share of singles grew slightly YoY in 2014, to the highest Compilations level since 2006 • 27 of the 100 top selling singles of the year were Dance, as were 1st and 3rd Singles most streamed tracks on Spotify (Clean Bandit – Rather Be, Mr Probz – Waves) Albums • Share of Compilations and Albums dropped slightly, but the genre maintained position of 2nd and 3rd most popular, respectively Source: Official Charts Company / BPI, Spotify 6 IMS Business Report 2015 by KevinWatson.net 1 Music Local DJs & Artists in South Africa dominated the domestic Airplay 100 chart in 2014 South Africa Airplay Top 100 2014 by Genre INDICATIVE Domestic International • Estimates suggest almost half of the Domestically produced records in the 2014 Airplay Top 100 were Dance / Electronic 20% • There are a number of successful South African DJs & Artists, 44% including Spoek Mathambo, Das Kapital and DJ Kent • Black Coffee in particular has built a sizeable global fanbase: o >1m Facebook fans Dance / Electronic Other Genres o >700k Twitter followers o >25k Soundcloud followers • For International tracks, one fifth were estimated to be Dance • c.7% of best selling tracks were estimated to be from the genre Source: Entertainment Monitoring Africa, Facebook, Twitter, Soundcloud, Industry Press, IMS Analysis 7 IMS Business Report 2015 by KevinWatson.net 1 Music There are now ten times more tracks available to download on Beatport as there were in 2008 Beatport Registered Users & Tracks Available (2008-14) • The number of tracks Tracks available on Beatport has Available increased tenfold since 2008, equivalent to c.50% per annum Index • Significant user growth (2008 has also been sustained =100) over the past seven years, with the total user base Registered Users now 4.5x that in 2008 • In addition, Beatport have recently launched a streaming service Source: Beatport 8 IMS Business Report 2015 by KevinWatson.net 2 DJs & Live Acts Forbes data shows inflation in DJ Earnings slowed in 2014, except for #1 Calvin Harris ($66m) Forbes Electronic Cash Kings (2012-14) $m 66 +97% YoY% 30 252 Top 9 12% 28 225 28 66 #1 43% 46 23 $m 114 2014 22 $305m 92 179 186 #2-9 4% Note: * Excludes DJ Pauly D 9 Source: Forbes IMS Business Report 2015 by KevinWatson.net 2 DJs & Live Acts DJs are using different social media platforms, such as Soundcloud, to drive their popularity Topdeejays.com Highest Ranked DJs (May 2015) Skrillex & Calvin Harris: >5m Sound- cloud followers Deadmau5: sizeable Twitter following Juicy M: Ukrainian female DJ known on YouTube for 4 CDJ mixing (>45m views) DVBBS: Smaller online fanbase, but DJ Mag #20 10 Source: Topdeejays.com, DJ Mag Top 100, Facebook, Twitter, Soundcloud IMS Business Report 2015 by KevinWatson.net 2 DJs & Live Acts Martin Garrix continues to grow his online fanbase by c.22k a day, reaching over 17m users Martin Garrix Social Media Reach by Platform – Additions by Year (2014 Vs 2015) YoY k 2,750 3,000 Chg • Garrix has added almost (%) twice as many YouTube subscribers in 2015 as 2014 -71 (c.150k a month) 820 • His 2014 Ultra Music Festival performance received 1.3m +27 680 views a year later in April 2015 +90 • He has also grown Twitter 440 and Instagram followers by a greater amount in 2015 +15 420 2015 • 54% of his fanbase is female YTD = • In April 2015, he received 2.5m -46 most Twitter mentions from 140 USA, Argentina, Spain, Philippines and Mexico Jan-May 2014 Jan-May 2015 Source: Next Big Sound, 5th May 2015 11 IMS Business Report 2015 by KevinWatson.net 2 DJs & Live Acts The success achieved by Nervo could be helping other female DJs in Asia to gain popularity Celeste Siam Nervo Nicole Chen Country: Country: Country: Rank*: 1 Rank*: 1 Rank*: 2 Facebook fans: 136k Facebook fans: 3.2m Facebook fans: 199k • 21st in DJ Mag Top 100 Nakadia poll 2014 Gayle San Country: • Only all-female act in Country: Top 100** Rank*: 2 Rank*: 3 Facebook fans: 57k • Highest ranking Asia- Facebook fans: 68k Pacific DJs in poll • Large following on Lisa Bluestar other social media Eva T Country: platforms, incl.Twitter Country: (741k), Soundcloud Rank*: 3 (423k) & YouTube (29m Rank*: 1 Facebook fans: 44k plays) Facebook fans: 43k Note: * Topdeejays.com Facebook rank for country of origin, November 2014; ** Excluding Krewella Source: Topdeejays.com, Facebook, Soundcloud, Twitter, YouTube, DJ Mag; 12 IMS Business Report 2015 by KevinWatson.net 3 Clubs & Festivals In the DJ Mag Top 100 Clubs 2015, European venues dominate, but 18 are in the USA, 6 in LV DJ Mag Top 100 Clubs by Country & INDICATIVE Continent (2015) • 18 clubs in 2015 Top 100 are in 30 6 clubs in Las Vegas 29 USA, including six Las Vegas venues, four in Miami, three in NY 5 in London • UK is next most represented 18 country, followed by Spain – 16 7 in Ibiza mainly thanks to seven venues in Ibiza being in the list # 10 Asia (7) Africa (1) 9 5 5 4 4 North Europe America (57) (21) Note: * includes Canada, Netherlands, Belgium, Cyprus, Bulgaria, Greece, Columbia, China, Japan, Malaysia, Egypt, Panama, Paraguay, Peru, Philippines, Portugal, Russia, Singapore, South Korea, India and Ecuador 13 Source: DJ Mag Top 100 Clubs 2015 IMS Business Report 2015 by KevinWatson.net 3 Clubs & Festivals In 2014, the 12 largest Electronic Music clubs in the US generated half a billion dollars in revenue INDICATIVE Electronic Music Clubs in USA by Revenue (2014) Revenue pa ($m): City Las Vegas Las Vegas Las Vegas Miami Las Vegas New York Miami New York Los Angeles Total = Miami $505m San Francisco Los Angeles Source: Nightclub & Bar Top 100 2015 (Low End of Range Shown) 14 IMS Business Report 2015 by KevinWatson.net 3 Clubs & Festivals Eventbrite study: quarter of all nightlife tickets sold in the US are for Electronic Music events 26% 72% of all Nightlife of EDM fans go events were $81 out at least two EDM related nights a week average spend on a night out c.3x music ticket 57% of price in NYC Vs 3 per night - EDM fans use Austin avg number of ridesharing drinks apps (Vs 46% consumed avg) 15 Source: Eventbrite: The Nightlife Economy: How Much Do People Spend on a Night Out? IMS Business Report 2015 by KevinWatson.net 3 Clubs & Festivals USA Festival growth has been huge since 2007, but levelled off in 2014, due to one weekend UMF USA Electronic Music Festival Capacity INDICATIVE (2007-2014) x10 increase = 46% CAGR • Research suggests Electronic Music fans in the US are 13% more 1.4m 1.4m likely than average to attend a festival • Many new festivals have entered the 980 USA, including Tomorrowworld, Beyond Wonderland and Mysteryland k 660 • However, attendance in 2014 475 remained flat YoY as UMF switched 345 back to one weekend 215 • Despite being sold out in 2015, the 145 price of early bird tickets for Ultra Festival 2016 have been lowered significantly