Spotify And Apple Battle China And Local Players For Africa’s Maturing Streaming Market

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Written by Tom Jackson

Global streaming giants Spotify and Apple have entered parts of Africa, but local digital music firms may offer the stiffest competition.

Given the size of the African market, the lack of activity from two of the world’s major music companies – Spotify and Apple Music – is quite baffling. Yet the battle for control of the African music space is heating up.

Chinese music streaming platform Boomplay is making a play for the African market.

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Spotify has perhaps given the continent the most dedicated attention, but its 2018 launch in South Africa is its only inroad south of the Sahara. Spotify has a presence in Algeria, Egypt, Morocco and Tunisia as part of a batch of Middle East and North Africa rollouts.

Apple Music is still only available in the same small number of African countries as on day one.

This is surprising. Africa has 1 billion people and many of them are young and tech-savvy, with consumer spending on the rise. Whereas Spotify and Apple have thus far mostly passed up the opportunity, China is filling the gap.

This has come in the form of Boomplay, a music streaming and downloads service launched in 2015.

A joint venture between phone-maker Transsion and apps developer NetEase, Boomplay is 100-percent focused on Africa, and has built a user base of 42 million people across a handful of different markets. The company recently raised $20 million in funding as it prepares to launch in more countries.

Tosin Sorinola, senior marketing manager for West Africa at Boomplay, said Africa was potentially a very lucrative market to play in for music services.

“We see several opportunities, from revenue generation and content creation, to being able to identify and break out the next big star, growing a platform that connects millions of music lovers to millions of songs and videos by their favourite artistes and a lot more. African music has a lot of potential and we are keen on being part of the narrative that exposes it to a larger audience and the world at large,” she said.

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The digital music market in Africa is attracting global and local companies. Photo by Yingchou Han on Unsplash

Boomplay’s recent funding will help it reach its goal of being the largest and most sustainable digital music platform, according to Sorinola, even though the company does envisage Spotify and Apple Music offering more competition than they do right now.

“Competition is good for business and we’re positioned to thrive even in the face of it,” Sorinola said, adding that the business models that succeed would be those with strategies that cater for the needs of its target audience the best.

Boomplay may have stolen a march, but smaller digital music companies have been operating in Africa for a while, keen on taking a piece of the pie for themselves.

African digital music platforms have a role to play

Kenyan company Mdundo has over 3.5 million monthly active users in Tanzania, Rwanda, Zimbabwe, Nigeria, Ghana and Mozambique, and works with 50,000 musicians.

Mdundo chief executive officer Martin Nielsen says there is a role to play for more local platforms, but believes it’s unclear exactly how the industry will end up looking.

“Will international services try to customise their services to Africa or just count on the high-end customers, as it seems Netflix is doing right now?”
Nielsen asked.

“International music services want labels to start investing in African catalogue so they can easier start in Africa. Labels are waiting for the music services as they currently don’t have any strong revenue streams in Africa – it seems to be a chicken and egg waiting game,” he added.

Whatever it ends up looking like, players have to adapt to local conditions.

“The biggest differences in Africa is payment methods and music catalogue. The music industry is extremely fragmented and most musicians and rights owners works individually and requires music services to license music directly from the individual owners.

“Mdundo license more than 2,000 new African tracks every month to avoid holes in the catalogue, however as the music labels start investing on the continent this will be much easier for both local and global streaming services to provide an attractive music catalogue,” Nielsen said.

What is clear is that there will be benefits for both customers and artists as the African streaming industry grows. Makhosini Mpofu, who runs Zimbabwean streaming service Zimbo Music, says consumers benefit from more readily accessible music.

“They now have music on the go and they get to listen to their favourite tunes sooner and with less hassle,” Mpofu explained.

For the artists, it is now much simpler and cheaper to put music out there, and receive instant feedback.

“The biggest advantage with African platforms today is that they are offering artists cheap exposure for their music to their fans. They no longer need big marketing budgets, radio pluggers to have their music played on radio, which in turn translates into the offline earning potential via live shows and merchandise,” said Dumisani Kpanga of Malawian digital music platform Mvelani.

Tom Jackson is co-founder of Disrupt Africa, a news and research company focused on the African tech startup ecosystem.