With streaming growth set to slow in mature western markets by 2019, the subsequent wave of fast growth will are derived from a variety of mid-tier markets for example Mexico, Brazil, Japan and Germany. The lower income mid-tier markets for example Brazil and Mexico are quite populous the urban elites have been sufficient to create paid user bases that happen to be similar to the ones from smaller European markets. The best scale opportunity, however, exists in monetising low income groups with less costly propositions. Beyond that, the streaming market will need to look towards emerging markets for growth. Emerging markets in Asia and Africa present a wide selection of opportunities, but current evidence suggests that the outlook for these particular markets is way from uniform.
The rule that defines emerging markets for streaming music is that often there is not one. China has a large base of free users and a solid base of subscribers. India has large numbers of free users, but a tiny paid base. Russia as well as Middle East have a solid ratio of free-to-paid users while Africa gets the lowest per capita metrics for paid and free.
Arguably, the most crucial reason for these particular differences is mobile data network availability and affordability. In China and India mobile data me is increasingly widespread, making streaming a compelling proposition, while in the majority of sub-Saharan African countries coverage is patchy and expensive.
Despite their differences, these regions are going to be critical to the long-term outlook for streaming growth. So, mapping their respective trajectories helps to forecast long-term global market growth for streaming. Rights holders will surely have to innovate from their rut if they're to actually seize the emerging markets opportunity. The truth that Nigeria's MTN only receives a retail ARPU of approximately $2 annually across sub-Saharan Africa due to its music products, including ringtones and downloads, shows where ARPU expectations may end up being set.
Every year at Midem in Cannes there are a lot of music producers from emerging markets. See my short report here: