Will Apple's Beats 1 Kill Off The Local Music Industry?

While Beats 1: a 24/7, worldwide radio station broadcasting to more than 100 countries, has this month been packed with programming about the premiere of Can't Stop, Won't Stop – the documentary about how hip-hop mogul P Diddy set the world of music ablaze with his New York-based record label Bad Boy Records, which once featured the likes of Mary J Blige and Notorious BIG on its roster – violent skirmishes between Uber taxis and metered taxis continue to crop up in South Africa: an Uber vehicle was set alight by unknown perpetrators in Sunnyside, Pretoria on June 6. Like the controversial vehicle-sharing application Uber – Beats 1 is a revolutionary novelty in its own special way. It is broadcast live from London and New York and Los Angeles and features a multitude of celebrity-hosted shows. 

Drake has a show on Beats 1. So do Dr Dre, Pharrell, Elton John and Q-Tip from a Tribe Called Quest. The premium online service is fairly inexpensive to subscribe to in South Africa as long you have access to free WI-FI or unlimited mobile data. Much like Uber – the ease with which one can access Beats 1 is very impressive. Yet Beats 1 could have a detrimental impression on the local music industry. Although Uber and Apple are all the rage right now: how do these multinational online-based businesses stimulate economic opportunities for local artists and businesses in markets such as South Africa? Or judging by the lengthy and acrimonious battle between traditional taxis and Uber operators: how do such enterprises annihilate local businesses? 

A leaked copy of a Sony Spotify contract revealed that streaming companies like Apple Music use sophisticated payment structures where the average "per stream" royalty to music rights holders is about between R0.08 and R0.11. So, if you streamed a song from your favourite artist 250 times in one year, the person(s) or establishment that holds the rights to that record would be paid about R27.50 in revenue. Subsequently – as is the case in many instances – that money would have to be split between the record label, writer(s) of the song and performing artist(s). But Beats 1 has become such a grand and prestigious platform: Don't Forget To Pray, a collaborative hip-hop effort from local hip-hop superstars AKA and Anatii premiered on Ebro Darden's show on Beats on May 5 – to much acclaim from local music aficionados. 

However, since Beats 1 competes with local radio stations and repatriates profits to the USA, its future successes may ultimately prop up the American entertainment industry and destroy the erstwhile viability of South African radio stations and profoundly affect local musicians: American and English marquee presenters host the top shows on Beats 1 and spin mainly American and British records. All this is happening while the local music industry stumbles from one disappointment to the other: the Hlaudi Motsoeneng-backed 90% local content plan has been reportedly abandoned by the new Khanyisile Kweyama-led interim board after the SABC incurred R200 million in losses as a direct result of the said empowerment initiative. Without formal preferential treatment local artists will inevitably earn less money in fees accumulated from radio play. 

So does the failure of the Motsoeneng-led content policy signal that local is not really lekker when it comes to music and entertainment? Beats 1 does regularly feature on its various shows local hip-hop artists who sound much like Migos, Rick Ross, Future, Kanye West, TI and Young Thug-like artists. Watch Channel O, Trace Urban or MTV Base: a lot of local rap songs sound straight outta Compton, Atlanta and New York. The global recorded music market grew by 5.9% in 2016 and revenues reached a record US$15.7 billion; while a record 112 million users of paid music streaming subscriptions were documented by December 2016, and this resulted in year-on-year streaming revenue growth of 60.4% - according to the IFPI Global Music Report 2017.

More importantly for struggling local artists who have limited revenue streams - digital income last year accounted for half the global recorded music industry's annual revenue for the first time. With over 1 billion iOS devices sold around the world and iTunes now available on Android smartphones and tablets - Beats 1 will undoubtedly develop into the leading radio station around the world both online and offline. Nonetheless the million rand question for local artists is: can local music compete against American and British music right here in South Africa? The commercial allure and mass appeal of foreign music remains as strong as ever. Justin Bieber sold out two huge concerts in Johannesburg and Cape Town in May. Only Cassper Nyovest – helped by celebrity colleagues like Babes Wodumo, Nasty C, Khuli Chana, Riky Rick, Kwesta and Major League Djz – has of late filled up a stadium like Bieber did last month.

While the 90% local content policy is commendable – local brands (call them advertisers) and listeners and viewers did not back local content that much: SABC deputy interim Chairman Mathatha Tsedu in April told the Parliamentary Portfolio Committee on Communications that the 90% rule cost radio R29m and TV R183m in revenue. However - should the SABC play significant amounts of American music again on its shows artists like Taylor Swift will reap immense monetary rewards but South African singers will not get similar airplay on American radio stations. Needless to say, if local artists are not amply remunerated and supported the cream of the crop will not surface. Thus the best singers and writers and producers will not work in the entertainment industry on a professional basis and that will have a negative influence on the quality of music released by South African artists. When that happens mainstream listeners will likely prefer better-packaged, better-produced and better-sounding products: foreign records. Should Beats 1 be subject to regulations that prioritise local music and facilitate local jobs and business for South Africans? You be the judge.