IMS Business Report 2017 An annual study of the Electronic Music industry by Kevin Watson 1 IMS Business Report 2017 by Kevin Watson, Danceonomics.com IMS Business Report 2017 An in-depth review of the industry today, and a look back over the past decade in Electronic Music A. Music Sales & Genres B. DJs & Live Acts C. Clubs & Festivals D. Companies & Brands E. IMS Ibiza 10 – A Decade In The Industry F. Industry Value 2 IMS Business Report 2017 by Kevin Watson, Danceonomics.com IMS Business Report 2017 A. Music Sales & Genres B. DJs & Live Acts C. Clubs & Festivals D. Companies & Brands E. IMS Ibiza 10 – A Decade In The Industry F. Industry Value 3 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres Streaming services and Latin American market continue to drive global music industry growth Paid Subscribers to Music Recorded Music Industry Streaming Services Revenue YoY Growth by Region (2012-2016) (2015-2016) 112m +65% 5.9% 68m 12% m 41m 7.9% 28m 20m 5.1% 4.0% Source: IFPI 4 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres On Spotify Mexico & Brazil are in Top 10 for total electronic streams; Higher share in Europe & Asia Total Electronic Streams Share of Electronic Music Listening (2017) (2017) Currently 12 billion Electronic music monthly streams on Spotify Source: Spotify 5 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres Dance increased share of all formats in the USA in 2016, rising to be the 5th most popular genre Dance / Electronic Genre Share of Total Consumption by Format (USA, 2015-2016) • Dance share of total audio 2015 consumption increased to 4% in 6 2016 2016 from 3.4% in 2015 5 • Genre moved above Latin to 4.7 th 4.2 become 5 most popular 4 overall, behind only Rock, R&B/ 3.4 Hip Hop, Pop and County 3 • For on-demand audio 1.8 streaming, Dance is joint 4th most popular genre with a 6% share • 57% of total Dance ‘sales’ are from streaming – the highest of any genre in the US Note: * Digital Albums & Digital Tracks used for 2016 Source: Nielsen Music Year-End Report U.S. 2015 & 2016 6 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres In Germany, Dance share of sales reached an all- time high in 2016, double that of three years ago Dance Music Share of Turnover (Germany) • Dance music share 7.0% climbed to 7% in 2016, making it the fifth best- selling genre • Share has grown in each of last three years, reaching double the level of 2013 3.5% • 58% of Dance music 2.8% buyers less than 40 years old – highest proportion of any genre – next highest is Rock at 34% Source: Bundesverband Musikindustrie (BVMI) 7 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres Latest statistics from France show Dance was the most played genre on radio in 2015 Music Genre Share by Medium (France, 2015) Radio Streaming Audio • On French radio in 2015, 29% 22% Dance was the most- played genre with a 29% share – 10% more than 19% 10% any other genre • For streaming audio, Dance had the second 14% 14% highest share with 22%, only behind Rap 11% 31% • Dance also secured a 13% share of streaming video, placing it third 11% 12% Source: Economie de la Production Musicale – Edition 2016 – Syndicat National de 8 l'Édition Phonographique (SNEP) IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres Beatport has continued strong growth in 2017 and returned to profit as part of LiveStyle Inc. Beatport Year on Year Growth (Q1 2016 - Q1 2017) +14% • Beatport has delivered renewed growth and returned to being profitable in the first quarter of 2017 • Visitors, registered users % +7% and track sales have all increased compared to the same period in 2016 +4% • Streaming service has been discontinued following restructure of parent SFX – now LiveStyle Note: * YoY growth is Q1 Jan 2016 compared to Q1 Jan 2017 Source: Beatport, industry press 9 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres Techno remains the best selling Beatport genre, with Trance and Drum & Bass highest climbers Best Selling Genres on Beatport (Q1 2015-Q2 2017) Techno remains 1 Techno #1 genre on 2 Tech House Beatport, slightly outselling Tech 3 House House 4 Deep House 5 Drum & Bass Trance resurgent 6 Trance in last 12 months 7 Electronica – up four to #6 8 Prog. House EDM genre 9 Future House Future House 10 Indie Dance / Nu Disco climbed to #9 11 Electro House Meanwhile, Electro House fell from #5 to #13 in just nine months 2015 2016 2017 Source: Beatport; Note: Techno includes Minimal / Deep Tech 10 IMS Business Report 2017 by Kevin Watson, Danceonomics.com A. Music Sales & Genres House is the most played genre on Pioneer DJ KUVO; Drum & Bass is highest climber in 2017 Most Played Dance Genres* on Pioneer DJ KUVO (Global, April 2016 – March 2017) 1 House House most 2 Tech House played genre, 3 Deep House accounting for 4 Techno 20% of all tracks 5 Drum & Bass Highest 6 Electro House climber is 7 Progressive House Drum & 8 Electronica Bass – up from #13 to 9 Trap #5 in 7 mths 10 Trap also gaining in popularity – up to #9 2016 2017 Note: * Excludes genres such as Pop, Rock, Hip-Hop Source: Pioneer DJ 11 IMS Business Report 2017 by Kevin Watson, Danceonomics.com IMS Business Report 2017 A. Music Sales & Genres B. DJs & Live Acts C. Clubs & Festivals D. Companies & Brands E. IMS Ibiza 10 – A Decade In The Industry F. Industry Value 12 IMS Business Report 2017 by Kevin Watson, Danceonomics.com B. DJs & Live Acts Forbes’ estimates earnings of Top 12 DJs fell 1% in 2016 to $300m – still 12% higher than 2013 Forbes Electronic Cash Kings (2013-16) INDICATIVE YoY% +4% -1% +9% Top 12 -1% • Forbes estimate 304 300 293 Calvin Harris’ Calvin 268 Calvin earnings fell 5% YoY Harris Calvin Harris #1 -5% Calvin Harris $63m in 2016 to $63m Harris Tiesto Guetta #2 3% • Places him #9 on Tiesto Guetta $38m overall highest-paid Guetta #3 -22% $m Guetta Avicii Tiesto $28m musicians list • Tiesto up to #2 (earnings +6% YoY), David Guetta down #4-12 4% to #3 (-24% YoY) • DJs / Artists placed #4-12 in list earned 4% more than 2015 13 Source: Forbes IMS Business Report 2017 by Kevin Watson, Danceonomics.com B. DJs & Live Acts The most popular DJs are growing their followers 11x faster on Instagram than on Facebook Growth in Online Fanbases of Viberate Ranked DJs (Past 3 months, May 2017) Top 10 Martin Garrix: World’s #1 DJ continues to grow online following, including 4.75m twitter followers The Chainsmokers: have grown their fanbase on every social network by 15-45% in past 3 months Marshmello & DJ Snake: using unique identities and branding to drive YouTube Selected Others & Instagram growth Nina Kraviz: Soundcloud followers up 19k / 8% in 3 months; 1.6m total plays 14 Source: Viberate, Facebook, Twitter, Instagram, Soundcloud, YouTube, IMS Analysis IMS Business Report 2017 by Kevin Watson, Danceonomics.com B. DJs & Live Acts The Chainsmokers are adding 28k social media followers a day, well below David Guetta’s peak Daily Social Media Follower Growth* 47k • David Guetta was adding 47k fans a day on Facebook and 10k Twitter in 2011/12 • The Chainsmokers are currently gaining 28k per day, 28k including Instagram k • Most viewed YouTube video 12k 37k for Chainsmokers (‘Closer’) 4k has 1.5bn views, 44% more than Guetta’s most-viewed 11k video ‘Hey Mama’ (1.1bn) • Debut album from The The Chainsmokers David Guetta Chainsmokers sold 166k (Feb-May ’17) (May ’11-May ’12) copies in US in first week Source: Facebook, Twitter, Instagram, Viberate, YouTube, Billboard, industry press, IMS Analysis 15 IMS Business Report 2017 by Kevin Watson, Danceonomics.com B. DJs & Live Acts Gender diversity remains a key issue – study of 24 festivals found only 17% of artists were female % of Festival Artists by Gender (2016) • Thump study of 24 festivals in 2016 found on average only 17% of artists were women 45% • Some Dance festivals had a much lower % - Beyond Wonderland had only 2 female artists out of 61 (3.2%) • Smirnoff campaign aimed at doubling number of female headliners at major music festivals in the next three years Average = 17% Average 3% Female Male Source: Thump, Vice, Broadly, Smirnoff INDICATIVE 16 IMS Business Report 2017 by Kevin Watson, Danceonomics.com IMS Business Report 2017 A. Music Sales & Genres B. DJs & Live Acts C. Clubs & Festivals D. Companies & Brands E. IMS Ibiza 10 – A Decade In The Industry F. Industry Value 17 IMS Business Report 2017 by Kevin Watson, Danceonomics.com C. Clubs & Festivals Millennials are 40% more likely to attend a club event in the USA, and total 2 billion globally US Live Music Attendance by Type in 2016* Index: % Millennials to % General Population % General • Overall 16% of people in Population the USA attended a club Club events (with 139 16% event with DJs in 2016, DJs) 14% for a specific DJ Club events (to see 136 14% • Millennials attendance specific DJ) at these events was 39% higher than average Music festivals 102 33% • Estimated 75m Live concerts with Millennials in the USA, 2 100 40% multiple headliners billion globally = 27% of population Live concerts with 59% one main headliner 107 • Hispanics also over- index on club events, Small live music spending 17% of their 112 41% sessions music wallet on them Note: *Question: Which of the following have you attended in the last 12 months? Source: Nielsen Music 360 – 2016 Highlights, Pew Research Center 18 IMS Business Report 2017 by Kevin Watson, Danceonomics.com C.