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Africa’s Digital Distribution Conundrum: iTunes Isn’t The Answer

Words by Phil Chard

Africa is continent hampered by underdevelopment and failing bureaucracies. Yet, it also finds ways to lead the charge towards new technologies and systems.

Take the mobile banking revolution and how systems like Mpesa have revolutionised not only mobile banking, but the the way in which the populace transacts in East Africa for instance. The barrier of entry into the formal system for the average working class African was too high, so a cheaper and more convenient way was created..That revolution was spurned because of a need within the banking sector.

The same parallel can be drawn for the music industry. As the majority of African nations transitioned from colonial rule to independent states, the Western record labels that had set up shop decided to leave the playground and take their toys with them. What remained were disjointed music industries with no means to produce and distribute works en masse. Demand for this music never waned. What happened was that the ability to sell it effectively was abruptly removed. When demand exceeds supply, someone will find a way to meet those needs. In this case it was pirates. As technology developed, it became easier for pirates to become the main source of distribution for music fans who just wanted to listen to the music they loved.

It seems artists are playing an exhausting game of whack-a-mole. Once one problem is tackled, another one pops up.

Artists have struggled to keep up with pirates; how could they? Pirates had the distribution models, they had the customer base, they had already scaled their businesses up and were enjoying returns on the investments they made in the equipment they used to reproduce content cheaply. For an artist, playing catchup was a steep ask. From printing CDs, to finding fans, to finding ways to compete with pirates on price and distribution. Most artists just threw in the towel and resigned themselves to working with pirates to get the music to the ears that wanted to hear it. This was the case with Nigeria’s Alaba Markets. Artists would enter into deals with pirate and sell them the masters of their new music at a discounted rate. The pirates would then leverage their resources to distribute and sell this music. That tactic speaks to the ingenuity of Africans - instead of engaging in a losing battle with pirates , artists decided to recruit the pirates as their distributors.

Technology has now leaped forward. Artists and pirates are on almost identical footing now. Almost...

With digital distribution options,  artists can distribute their music to hundreds of musical stores instantly with the upload of a .wav file and the click of a few buttons. They can reach their social media fans instantly with one post, and they can share that content with blogs and media publications by e-mailing them a press release. With digital distribution. artists can now reach their fans just as effectively and easily as the pirates can. Pirates still have the upper hand though, and it’s price. You can’t undercut someone selling a product for free. Piracy still thrives because the new pirates are blogs and torrent sites who make money on advertising impressions and not sales.

Read my Detailed Analysis On The Issue Of Piracy Here

It seems artists are playing an exhausting game of whack-a-mole. Once one problem is tackled, another one pops up.

So how do artists use digital distribution to ensure that their music is reaching fans across the world while simultaneously guaranteeing that these fans can pay for it easily and the artist can be rewarded for their efforts?

OK let's discuss. All about solutions. Shoutouts to you for coppin it via mobile money tho. https://t.co/eWuL9Esl5l

— M.anifest (@manifestive) March 16, 2017

Enter iTunes, the music solution pioneered by the turtleneck advocate and revolutionary Steve Jobs. iTunes sparked the revolution that shifted the entire Western music industry on its head towards a movement commonly referred to as “the unbundling of the album”. Before iTunes, artists and labels made their money from selling albums. The formula was simple:. Create 1-4 standout singles to place on the album and drive interest. Fill the rest with whatever you could and watch the money roll in as every fan was forced to pay for the full album even if they only wanted to hear 1 or 2 songs on the project. iTunes changed that. Fans could buy only the songs they wanted to hear. Obviously this was bad for record label business and good for the fans.

Eventually, the labels adjusted their strategies. Cohesive albums have now taken a backseat while singles have taken over. Albums are often held back until the artist can produce a commercial hit to back the effort. I have spoken  to several artists who have had projects shelved for years because of this. Based off of a MIDiA research study, which found that streams originating from playlists were 20 times greater than streams from end-to-end listening of an album and nearly three times the number of streams from albums, one could argue that the labels have a point.

A look at how artists like AKA are releasing music shows the shift to singles, and the the depreciation of albums

In recent years we've seen African artists shift their attention to iTunes as the solution to distribution..  This has become even more apparent with Apple Music now setting its sights on Africa. Artists like Mr Eazi have partnered with the platform to promote his project. We've also seen artists now refer to iTunes chart position as the defacto measurement of success.

On paper it makes sense; iTunes is one of the planet's biggest online music platforms. Some might argue that it's ubiquitous, and in some cases has become the premier channel for digital music. Apple ships millions of phones every quarter, while iTunes’ market cap accounts for billions of dollars.

Though true, iTunes domination in the USA or Europe  does not translate to Africa. In 2015, Apple iPhone devices only accounted for 2.2% of the mobile market in the Middle East & Africa and only 7.9% of the devices in South Africa. At best, an African artists is only reaching between 2-8% of their potential fan base. On a continent with only 362 million active Internet users  (29% of the population) and only 226 million with smartphones (this figure includes Android, Windows Phone, iPhone and Blackberry) it makes little sense to use iTunes to reach the masses.

In Africa these are the steps a fan needs to go through before they can make an iTunes purchase

  1. Purchase an iPhone (Prices for the current model iPhone 7 start at $750 USD).

  2. Have access to a fast and reliable, preferably unlimited Internet connection. Prices may vary depending on your region.

  3. Possess an approved credit card, or have access to iTunes vouchers

  4. Be prepared to part with $1USD for every single and $10 USD for every album (Prices do vary by region)

Despite the highly exclusionary nature of iTunes, the pricing model in the store makes no sense for Africa. iTunes has simply tried to replicate the model it uses in the West here, and  it won't work in Africa. Simply, people can't afford it. Owning an iPhone and having the disposable income to purchase music regularly on the platform is an extreme sport in Africa. The cost of the phones and steps needed to create the account, plus the cost of data, does not translate into something that will gain critical mass.

Apple remain tight-lipped about their numbers, they always are.

A few months ago, while trying to gain insight into the African music charts, I began a tracking the iTunes singles and albums charts in Nigeria, South Africa and Kenya via a service called Soundcharts. What I discovered was that sales for African acts across the continent were embarrassingly low on iTunes. I spoke about my  findings in detail on Twitter, and you can review them below. International albums that are as old as 20 years are regularly outselling new local releases. What this shows is that Africans simply aren't buying music on iTunes, and it’s mainly due to the reasons I have mentioned above.

ITunes Charts Are Useless - Curated tweets by PhilChard

To their credit, Apple has tried to address the pricing issue by allowing prices in local iTunes stores to reflect the “expected” rates of that particular region. I recently switched from an American iTunes account to a South African account because I would pay half the price for my Apple Music subscription and save about 30% on music purchases after converting.

The fact remains: iTunes is not a solution to reach the masses. It's a niche service for high-value fans willing to pay a little more for convenience.

How Can iTunes Change This?

If iTunes aims to become the platform of choice for African fans, the company needs to have an iTunes app for Android. Getting Apple Music on Android was a smart move and a critical first step that introduced the Apple ecosystem to Android users and enthusiasts, similar to how iTunes introduced itself to Windows users when it launched for Windows in 2003. Once you have people in your ecosystem, making purchases and building their libraries in iTunes, they are less likely to leave.

I'm the perfect example of this. I have been an ardent Windows user since birth. In 2004 I switched from Windows Media Player and Winamp to iTunes. I have spent thousands of dollars in the iTunes store on music. Despite being an Android enthusiast I would use an iPhone as a second phone simply because I was so entrenched in the iTunes ecosystem.

I  type this in a very tongue-in-cheek fashion. I know iTunes will most likely not introduce any of these steps, and I don't blame them. Their business is running smoothly without my help. With over $216 Billion in cash reserves, they can be forgiven for not focusing their sights too hard on Africa.

And that's the point.

Apple doesn't have to adapt its services for Africa. The Apple brand is so big they can still afford to operate as an exclusive brand with attractive operational margins.  Apple, and iTunes by extension, have planted their flag on the continent and demanded that we adapt to their culture. So why are we trying to do so? It's a square peg for a round hole. Why do African artists miss this? iTunes shouldn't be your focus when number one albums can be crafted with a handful of purchases. No chart is a true reflection of the culture if albums released two decades ago are your biggest competition.

Ensuring your music is on iTunes and being promoted on the platform should certainly be part of an African artist’s strategy, but it certainly shouldn't be the main focus. The majority of your fans aren't on iTunes. The answer to where they are is more complex; there is no one platform that enjoys continental domination.  This is where artists have the opportunity to band together and create custom solutions for their fanbases.

What Diamond Platnumz has done in Tanzania is launch a webstore for his record label Wasafi. You can purchase music from Wasafi artists and other Tanzanian acts on it. The site is still glitchy when trying to process international card payments, and it certainly isn’t the panacea we are hoping for. But it is a workable, scalable solution for Africa.

As it stands, telcos seem to be leading the charge towards finding a ubiquitous system for music purchases. Several elcos are replicating the MTN model.

But can we, should we, trust telcos to help carry us to the promised land? Recent history would suggest no.  COSON is suing MTN for $80 million dollars for non payment of publishing royaltiesTigo Tanzania was ordered to pay AY and MwanaFa close to $1 million dollars in a copyright dispute.

Until changes are made and real growth is experienced, iTunes charts in Africa will hold the same weight as my 25-metre breaststroke certificate from 1992 that my mother hangs on her office wall. It's a cute achievement, a source of pride that she uses as a conversation starter with friends. But in the grand scheme of things, it doesn't mean shit.