Africa: The Growth Of Streaming
Music streaming has dramatically changed the sources of income for most powerhouses in music. In 2018, IFPI reported that $8.9 billion in revenue was made from streaming alone, contributing to 50% of all music revenue globally. The top ten markets are represented by countries in continents apart from Africa. In this article we will explore streaming in Africa.
Expensive data plans and unemployment are a couple of the issues that Africa faces. The Alliance for Affordable Internet reported that 1GB of data counts for 8% of income on average across the continent whereas in comparison to other markets across the globe, 2.7% is the average across The Americas and 1.5% in Asia. Nigeria, one of the most densely populated countries in the world has an unemployment rate of 6.03% in 2018 according to macrotrends.net which equates to 9.5 million people. Despite the roadblocks that have been mentioned, streaming has managed to find its way to Africa and is growing!
Boomplay is Chinese backed streaming platform and is currently the largest streaming platform in Africa. It’s backed by Transsion, the second largest supplier of smartphones in Africa. By April 2019, Boomplay had reached 44 million active users and offer an ad supported service and a paid subscription at the equivalent of $1.50. It’s been reported that the number of smartphones in Nigeria is due to grow by 60% by 2025 and Udux plan to take advantage of that. The Nigerian based company is the first domestically founded company of its kind in the country. It offers music streaming as well as HD music videos for an equivalent $1.30. After a ‘soft’ launch in spring of 2019, they were able to attract roughly 65,000 subscribers and relaunched in February of 2020.
M-pesa, a payment system provided by Vodafone provides users with financial services such as paying bills, sending and receiving money as well as receiving salaries. This service is available in Egypt, Tanzania, Ghana, South Africa and a few other countries. This service has been in South Africa for more than ten years which coincidentally is the first country in Africa where Spotify launched. According to Statista, streaming revenue for 2020 was expected to be $35 million in South Africa. Such a piece of infrastructure will be vital to streaming advancements in Africa. Most countries in Africa still see an exchange of physical cash for goods as the only means of exchange, how does streaming continue to advance if cashless systems are not part of the norm?
Music revenue sales from Nigeria are expected to reach $44 million by 2023, Transsion (Boomplay) has strategically placed themselves at the epicentre of what they believe is to come. By providing smartphones to the masses, thus creating an ecosystem, the potential return on investment is huge. The IFPI may not have mentioned any major markets in Africa as of right now, but the trajectory is bullish and the duopoly that is Apple and Spotify may already face stiff competition in the developing market.
