Recorded media

This category comprises gramophone records, discs for laser-reading systems for repro-ducing sound only, magnetic tape (recorded) and other recorded media for sound reproduction.

Within the international flows of cultural goods, the share of recorded media fell only by 1% between 1994 and 2002. In 2002, this category represented a substantial share of 32% of the value of all trade of cultural goods.

The aggregate value of recorded media worldwide in 2002 was US$ 19.4 billion in imports and US$ 18.5 billion in exports. These figures should be put into perspective by comparing them with the global size of the sound recording industry¹³ (see Box 4).

Box 4. The music sector: Market for recorded media

Despite the widely reported crisis during the mid-1990s, the music industry still remains powerful and plays an important role in the economic growth of many countries at all level of development. The music industry’s reported global retail sales for 2002 reached 3 billion units and amounted to US$ 31 billion.

In 2002, global music markets were led both in volume and value by the USA (39.8% of world sales), Europe (34.6%) and Japan (14.8%). Asia shared 17.7% of the global music market and was the third largest player, with Japan accounting for around 80% of sales in the region. Latin America, where music was considered the fastest growing segment of the global entertainment economy in the mid-1990s, had only 3.2% of the global music market in 2002.

The African music market was the smallest regional market, with only US$ 130.7 million in 2002, representing a mere 0.4% of total global sales. However, the basis for assessing the size of the African market seems questionable as data on recording sales were only available for two countries.

A key element in understanding international flows of recorded music is the domestic demand for locally produced music and its relation to imported recorded music. Figure 22 illustrates the market share of imported contents in selected music markets. The data for locally produced music are available only for recording sales, and even these figures are incomplete. Existing data suggest a 10% growth in the world’s average demand for domestic repertoires during the 1990s, although since 2000 there is some evidence of demand slowing down. The preference for domestic repertoire might indicate a certain improvement of the ability of local music industries to serve their domestic audiences; it does not necessarily mean that high local repertoire is always produced and distributed by local companies only.

Figure 22. Repertoire origin as % of market value¹⁴, 2002

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Egypt U.S.A. India Zimbabwe Saudi Arabia Japan Thailand Brazil Russian Fed. Republic of Korea France Qatar Lebanon United Kingdom Ukraine Bahrain Romania Argentina China Israel Mexico Bulgaria Pakistan South Africa Sweden Canada Ireland Chile Australia Malaysia New Zealand

Domestic International Others

Source: The recording industry in numbers, 2003, IFPI.

13 Global reported retail sales in 2002 were about 3 billion units for a value of US$ 31 billion (see Box 4).

14 Multi-artist included where supplied and “Others” covers regional, classical and multi-artist.

In regard to trade by level of income, Statis-tical Tables II (see Annex I) show that in 2002 high-income countries still held a leading position and accounted for 94.1% of global exports and 82.5% of global imports of recorded media (the USA and EU15 countries in Europe alone accounting for 74.8% and 55.6% of global exports and imports respec-tively). However, encouraging signs also have emerged for developing countries and coun-tries in transition. They saw their position rise from an 8.8% share in 1994 to 17.5% in 2002, enjoying a particularly rapid annual growth rate during this period (20% on average for the three categories). However, as in other sectors of cultural industries, this growth has not been homogeneous and has benefited only a small number of developing countries and countries in transition, notably those in Asia. Asia ranked third among all regions exporting musical industry goods, growing from 7.6% of world exports in 1994 to 18.2%

in 2002, and from 15.8% of global imports to 21.8%.

In 2002, the three principal exporters (Germany, Ireland and the USA) accounted for 40.4% of global exports, followed by the

United Kingdom (8.9%) and Singapore (8.4%). Imports were slightly more evenly spread among the five leading importers (Canada, France, Germany, the United Kingdom and the USA) which together accounted for 38% of global imports. Hence the importance of Ireland, Japan, Germany, the United Kingdom and the USA as the major participants in physical trade in music-related products were apparent. The advan-tageous position of Ireland was mainly due to the presence of a number of multinationals specialising in software and information technology, contributing to the production of music-related products.

However, the data presented above do not provide a comprehensive picture of the direc-tion and magnitude of internadirec-tional music flows. Since they are based on customs information, they can only show the imports and exports of tangible musical products, whereas much of the trade occurs in the form of original masters which are then processed locally for domestic retail distribution. Box 5 illustrates the difficulties of capturing the value of such intangible assets.

Box 5. Capturing the value of intangible assets: The case of the Jamaican music copyrights It has been estimated that in 2000 Jamaican music represented nearly 3.5% share of the global music market, generating revenues of over US$ 1 billion. However, little of this business activity took place in Jamaica, whose domestic music industry has been assessed within the range of US$ 60-100 million for the year 2000.

This includes income from sales of recorded music estimated at US$ 40-50 million and income from foreign tours, local concerts/festivals and other activities at US$ 20-25 million. These figures, however, do not include the substantial amount of revenue generated worldwide from public performance royalties due to Jamaican songwriters, interpreters and music publishers, as well as similar royalties earned by music producers and performers which bear no relation to actual record sales. For Jamaican composers and performers alone, royalties received by European, American and Asian copyright royalty collecting societies are estimated at about US$ 385 million.

Sources: Music and the Jamaican Economy, Michael Witter. WIPO UNCTAD 2000.

Becoming a globally competitive player : The case of the Jamaican Music Industry, Discussion paper n° 138, UNCTAD Zeljka Kozul-Wright and Lloyd Stanbury, 1998.