Cast your mind back to March, when the coronavirus was causing frightening harm in Italy – not only to the health of the nation’s population, but also to the local economy.
Understandably, representatives for Italy’s recorded music industry feared the worst.
In late March, FIMI – whose members include Universal Music, Sony Music, Warner Music and BMG in Italy – forecasted that Covid-19 would halt the annual growth of Italy’s recorded music business, while noting that the country was already seeing “signs of crisis”.
Today (September 22), MBW can reveal more some positive signs for Italy, which was the worldwide record industry’s 12 biggest market last year, according to IFPI stats.
FIMI has handed MBW new data which shows that in the first six months of 2020, the country’s recorded music industry generated wholesale revenues of €87.97m, up 2.1% on the same period of 2019.
Removing sync from the equation – leaving us with just music streaming and sales revenues – Italy’s recorded music market was up 3.1% YoY in H1 2020.
The propulsion behind this growth, of course, was streaming.
FIMI’s stats show that subscription audio streaming revenues jumped up 33.6% in H1 2020 to €48.25m.
Despite fears over a collapse in advertising revenues due to Covid, ad-supported audio streaming revenues also rose materially, up 19.3% in Italy in the first half of the year.
Overall, music streaming (including ad-supported and subscription audio, plus digital video ads) generated €68.84m in Italy in H1 2020, up 26.4% YoY, and making up 82% of the total market in the six-month period.
Physical music revenues were in a music worse state, down 47.9% YoY to just €11.68m, comprising only 14% of the total market.
Obviously, these numbers give cautious reason for optimism, especially following similar H1 2020 revenue rises (of various proportions) for the record industry in the US, Germany, France and elsewhere.
It should be noted, however, that Italy’s half-year numbers cover both Q1 and Q2, and recent major record company financial filings suggest the brunt of Covid-hit revenue falls occurred in the second of these two quarters.
Another thing worth remembering, here: sync licensing was down 15.5% in Italy in H1 2020, and these numbers don’t include any performance licensing income – which would usually be derived for labels from shops, bars and restaurants, which were largely closed during Q2 in Italy due to the virus.
The global industry will now be crossing its fingers that Italy and other markets can keep up this growth pattern in the second half of 2020.
Enzo Mazza, the CEO of FIMI in Italy, points out to MBW that one of the most interesting things about the country’s numbers in H1 2020 is the significant uptick in streaming subscribers over the age of 40.
“According to information from the [digital] platforms, we saw an increase in adults using the streaming services. The so-called lockdown economy gave a strong push to digital in Italy and a lot of adult consumers turned to e-commerce and streaming.”
Enzo Mazza, FIMI
“After an initial slowdown due to the change in habits by the young generation, streaming [volume in Italy] promptly revamped and by the end of March and the beginning April was already back on track,” says Mazza.
“According to information from the [digital] platforms, we saw an increase in adults using the streaming services. The so-called lockdown economy gave a strong push to digital in Italy and a lot of adult consumers turned to e-commerce and streaming.”
Mazza notes that “Italian repertoire driven by hip hop and rap performed quite well both on album and singles charts,” with the 2020 half-year Top 10 albums rankings made up 100% of Italian artists.
The first international artist on that H1 2020 albums list, says Mazza, was Billie Eilish at No.21.
“As we all know the main issue now remain the current situation of the live sector and also the collective rights where we lost in some segments more than 70% due to the lockdown hitting bars, hotels, gyms, discos and so on,” adds Mazza, who suggests that Italy’s so-called “culture bonus”, whereby 18-year-olds were given a $500 bonus by the government, was key in keeping the physical music sector afloat, driving more than €6m in sales.
FIMI also lobbied for a special fund for small and medium record labels from the Italian government, to soften the blow from the coronavirus lockdown, which was activated before the beginning of September.Music Business Worldwide
