A Guide To The Music Industry In China – Part 3 Media & Marketing
The media is filled with articles on doing business in China,
but nowhere is there a primer for understanding the music industry
there. Ed Peto lives and works in Beijing as a promoter, music consultant and writer shares his insights. (Read Part 1- Piracy & Retail and Part 2 – Inide & Major Labels.)
PART 3 – MEDIA & MARKETING –
Danny Sim, international marketing manager at Universal Music China, is optimistic about growth in western music sales. UMC will release 40% more international titles this year – roughly 100 albums – and expects to see a 10-15% growth in revenue. Sim puts his optimism down to: “a) More people getting a better education, and therefore more people with English as a second language, b) More western music spread through the internet, and c) More media channels will become western music friendly.”
Sim has neatly summed up the problems facing western music marketers in China. Learning English is a high priority for your average urbanite…There is some way to go, however, before this manifests itself in legitimate music sales. As Sim points out, a good starting point would be an increase in western music coverage in the media. Very little western music is played on China’s state-run radio. An exception would be a station like Beijing’s HitFM which plays US and UK Top 40 hits to an audience of English language students, expats and western-trend-conscious young people.
The government is very protective of its airwaves and rules its own network of regional licensee stations with a rod of iron, both in broadcast policy and physical presence. The live studios are frequently under armed guard..
for fear of them being stormed by subversives. The same applies for TV.
When Pop Idol imitator SuperGirl hit China in 2004, the final was watched by 400 million people. The rush of mobile votes sent the government into a panic and severe restrictions were implemented, preventing the show ever happening in the same format again. The idea of a democratically decided pop show proved too much for a one-party state to countenance.
PAYOLA RULES
for international music marketeers there is a limited spread of outlets through which to promote artists. This is especially true when you consider that music coverage is based more on cold hard cash than on merit. You could turn up to one of the few music-specific TV channels like Newscorp’s Channel V or MTV (which has a minute presence in China) with the best pop video in the world looking for airplay, but the response is likely to be “What’s in it for us?”. In this sort of climate – where media needs to be bought – the returns simply do not justify a label allocating a significant marketing (or coverage) budget to “break” niche foreign artists. They generally rely on larger artists’ spill-over publicity from the west.
Read Part 1- Piracy & Retail and Part 2 – Inide & Major Labels
Really digging this series. At first I thought it was just a curiosity — interesting only because it was exotic — but I can increasingly see that China might be what the US music biz looks like 5 – 10 years from now.
Seeing how these companies are coping and innovating is downright inspiring.
First I would like to thank you for such an insightful post. Your first hand experience in the Chinese music market is invaluable which is reflected within your writing. Your three part series, “A Guide to the Music Industry in China”, was incredibly insightful. I enjoyed the format in which you set up your guide although I would like to share some comments.
First, it sure sounds like physical product in China is pretty much dead. I strongly agree with that statement. Here in the United States, we are under a seven year, ongoing decline in CD sales. With media mediums such as iTunes and Napster successfully emerging in distributing digital entertainment, it seems that it is only a matter of time before physical product essentially becomes obsolete.
Furthermore, I believe one of the stronger points you brought up was the problem with the state-run radio programming. Radio, one of the fundamental marketing tools for music, is necessary for the outreach of new artists and the continued success of superstar artists. If governments continue to monitor the airwaves with such clout, it seems to erect an impossible barrier to entry for any prospective, music-related business attempting to successfully market its products.
So if we can’t sell physical product, digital distribution seems almost just as pirated if not more than the physical product, and we have little to no influence over the FM waves, where is the money in such a lucrative and flourishing business economy such as China? Well, if a new show such as SuperGirl airs in front of 400 million people, who not only watch the programming but also interact through mobile voting, I feel as if the industry may succeed and be able to capitalize on such appeal. Similar to the Superbowl, which according to CNN.com charged an average of $2.7 million dollars for a thirty-second television advertisement spot, China’s music industry could benefit from such advertising revenues. Alongside advertising revenues, such interaction from viewers creates even more steams of revenue. According to a press statement made by Cingular Wireless regarding American Idol voting, “If Fox would have offered this service as a premium SMS service, charging a voter 50 cents per vote, the gross revenue could have been $38 million, or $3.2 million per episode, which would probably taken care of the entire production budget for the show.”
All in all, I thoroughly appreciate your expertise and knowledge and look forward to reading more posts from you looking into the future of music.