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‘Glocalization’ is Pushing Local Music Up the Charts and Driving Investment Globally

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U.S. labels and musicians have long counted on welcoming international audiences to turn home-grown successes into global stars. Just as people around the world snap up tickets for Hollywood blockbuster movies, consumers abroad have been typically eager for English-language music from the world’s leading entertainment exporter.

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In recent years, however, U.S. pop stars have increasingly heavy competition from artists most Americans will never know. In France, the top song of 2022 was “Tout va bien” by Alonzo featuring Nino and Naps, according to French recorded music trade group SNEP. Only one foreign song, “As It Was” by Harry Styles, cracked France’s top 10. The top of the chart’s composition looked drastically different from previous years. In 2017, when Ed Sheeran’s “Shape of You” reigned supreme with French music fans, five of the country’s top 10 songs came from foreign artists. In 2012, eight of France’s top 10 songs were from foreign artists.

To Will Page, author and former chief economist at Spotify, the changing fortunes of French artists is evidence streaming and online platforms have changed the balance of power. “When the cost structure changes, local [music] bounces back,” he says. The CD era involved higher costs — mainly manufacturing and marketing — that favored international artists. Despite France’s rule that a quarter of the songs played on radio must be French, the system still tilted toward foreign artists with greater financial backing.

But with streaming and digital distribution, those costs are all but eliminated. Local artists are free to create and distribute music in far greater numbers, satiating a demand that had been unfulfilled. Consumers who previously listened to American pop stars are all too happy to stream artists singing and rapping in their native tongue. “An unregulated free market has achieved what regulation failed to do,” says Page.

In a paper titled Glocalization of Music Streaming Within and Across Europe, Page and Chris Dalla Riva, a musician who works at music tech startup Audiomack, showed France is hardly alone in this trend toward “glocalization” — local entertainment succeeding in an increasingly globalized digital economy. In other large European markets such as Italy, Poland and Sweden, consumers are also gravitating toward local artists who create music in local languages. These countries — along with Spain, the Netherlands, Germany and the U.K. — matched or reached their peak domestic share of top 10 songs in 2022. In 2012, less than a fifth of the top 10 songs in Poland, France, Netherlands and Germany were local artists. In 2022, local music’s share of the top 10 songs reached 70% in Poland, Italy and Sweden, 60% in France, 30% in the Netherlands and Spain, and 20% in Germany.

Similar results are echoed on TikTok, which has transformed how people discover music around the world. In France, Italy, Poland and Greece, 80% of TikTok’s top 10 songs of 2022 were by home grown acts. Local artists accounted for 60% of the top 10 in Spain and 50% in the U.K. Local hip-hop is especially popular on TikTok in these markets, says Paul Hourican, the platform’s global head of music operations. Drake and Eminem may have a universal appeal but don’t connect with audiences the way local musicians can. “When you think about what hip-hop is, it’s amazing beats and truth telling, and speaking their truth in local language,” says Hourican. “That seems to be really, really connecting, and kind of forwarding the culture of hip-hop into into all these markets.”

The localization shift doesn’t surprise Sylvain Delange, managing director, Asia Pacific at French music company Believe. “We knew that the market would grow domestically, and that the local music would take a bigger share of the music consumption,” he says.

“When streaming came in, there was a very natural effect that skewed consumption towards international music for the simple reason that when streaming music comes, it serves, first and foremost, the higher income, large, tier one cities that are more open to international influence,” says Delange. “So, it’s very logical that in the beginning, international music would over index on streaming platforms. But then it would progressively switch back towards a fairly natural trend — which is domestic music.”

Early on, streaming services’ curation was much more focused on English-language music, adds Dominique Casimir, chief content officer at BMG. “You couldn’t put an Italian song in the middle of that playlist, that just certainly makes no sense.” But as streaming exploded in popularity, the services hired more staff to service the local music market and put a greater emphasis on local music. With boots on the ground, streaming services created channels and playlists that focused on local repertoire, she says. “That did change massively the work we can do together with DSPs.”

Supply alone doesn’t explain the trend toward globalization, though. An additional explanation, “is generally people’s need to identify with their culture,” says Golnar Khosrowshahi, CEO of Reservoir Media. “That is driving listenership and the importance of that identification, whether it’s around the subject matter or the sound or the person. This is not new news. People identify with their culture. Their culture is important to them. Maintaining that culture is important.”

To take advantage of the forces shaping globalization, Khosrowshahi has targeted investments throughout Latin America and the Middle East. Among Reservoir Media’s recent acquisitions are the catalogs of Latin songwriter and producer Rudy Perez and, in conjunction with PopArabia, the catalogs of Egyptian company RE Media and Egyptian rap duo El Sawareekh. Additionally, in June, Reservoir Media and PopArabia formed a joint venture with Saudi Arabian hip-hop label Mashrex and acquired some of its back catalog.

“One of the reasons we’re compelled by the Middle East market and the Arabic-speaking market is because of the size of that diaspora,” says Khosrowshahi. “The geographical reach of that diaspora goes to Malaysia and Indonesia. You have substantive Arabic speaking populations, granted different dialects, but music seems to be able to transcend them a little bit.”

Through both catalog acquisitions and frontline label partnerships, companies are finding opportunities in an increasingly online global music market. Investments are now commonplace in developing markets that were previously overlooked by music companies. Believe acquired Indian music company Venus Music, partnered with Indian imprints Think Music and Panorama Music, and partnered with Viva Music and Artists Group in the Philippines. In August, Universal Music Group-owned Virgin Music Group acquired United Arab Emirates-based Chabaka. In 2022, Warner Music Group purchased a majority stake in Africori, the top digital distributor in Africa.

While TikTok and streaming services’ international popularity have leveled the playing field for local music around the world, Delange says YouTube has been the biggest driver of this trend over the last decade. For years, a debate raged throughout Europe and the U.S. about YouTube’s “value gap,” the difference between its ad-supported royalties and per-stream payments from competing subscription services. While the West was hesitant to embrace YouTube, Asian artists and labels embraced the opportunities for promotion, marketing and monetization, says Delange. In the West, YouTube was a problematic free platform. In the East, YouTube was a free platform with a massive audience. “That was revolutionary in a market that had been decimated on the physical side,” says Delange. It’s now proving the driver for a new stage of growth in the global music market.

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