Daniel Antal, CFA | Digital Music Observatory

Inquiry Into The Live Music Industry In Wales

Fri, 06 Nov 2020 08:10:00 +0200

In July 2020, Professor Paul Carr of University of South Wales was commissioned by Senedd Cymru – the Welsh Parliament to create a report examining the ‘state of play’ in the post Covid-19 music industries in Wales.

WATCH: @pcarr came to give evidence to @SeneddCWLC
for our inquiry into Live Music Industry in Wales 🎵 pic.twitter.com/GtrYPOg8iW
— Senedd CWLC (@SeneddCWLC) October 18, 2019

Click through to see a short interview with Prof. Paul Carr

The music industries in Wales consist of both part-time and full-time stakeholders and although dominated by live and recording sectors, also comprise of other sub-sectors, and like in other countries that we surveyed in Central and Eastern Europe, many stakeholders in the music industries are freelancers, following multi-track careers.

Prof. Carr’s report is particularly interesting for our Music Observatory project because the Welsh nation is a part of a larger entity, the United Kingdom, and many important statistical products may need to be recreated for this sub-national level — something we have been doing with our survey retroharmonization and regional statistical tools for some time.

The Welsh Music Industries in a Post-Covid World will be presented to the Culture, Welsh Language and Communications Committee later this month, and we will publish the entire report in English and start a discussion around it, too.

Why Did We Start The Demo Music Observatory?

Tue, 27 Oct 2020 10:00:00 +0200

I was contacted during the consultation period of the Feasibility Study of the European Music Observatory. That led to an uneasy series of conversations with the consultants of this project, and a very enlightening series of conversations with European civil servants, music industry organizations, music managers and artists. My main pitch was that every single assumption of this project is wrong.

They started from the assumption that there is hardly any data available on the European music scene – whereas we found while building up CEEMID, errr, a pan-European music data observatory, is that music is one of the most data-driven industries in the world, it is choking in numbers, and the reason why this data is not visible is very different. They were talking about lack of data in fields where we already had about 2000 pan-European indicators ready. (See Introducing the CEEMID Observatory, 9/28/2019 large self-contained html file, takes time to load into browser)

Big data creates injustice

The music industry is scattered: it has the author’s or publishing side, the recording side, a large live music business and usually a very environment for classical (art) music. Within these segments there are hundreds of organizations in each EU country, and each have their own small or large datasets. The music industry has plenty of data, but it is not integrated, and it is often hidden from organizations that may have a conflicting agenda.

The fragmentation of data makes these players easy prey in the era of big data. Companies who monopolise big datasets first and create weapons of math destruction in the forms of algorithms that work for them, can take an unusually large share of the money created throughout the value chain. Proprietary, uncontrolled, big data trained algorithms reinforce inequality — this makes Google’s YouTube, Spotify, but also Netflix in films or Amazon in books so powerful against its competitors, but also against competition regulators or suppliers — in this case songwriters, video producers, filmmakers, book publishers and authors. If their algorithm works against a creator, the creator is doomed, because half of the global sales are driven by secret algorithms.

Big Data vs Small Datasets, Research Automation

The problem of the music industry is not too little, but too much data. Music is drowning in numbers, and it has too little resources to turn much data into valuable information.

Our concept of the European Music Observatory is to pool enough resources to create value for rightsholders, talent managers, venues, festivals and the entire music ecosystem. Most music organization employ 1-5 people, and even the largest national organization, like collective management organizations, fall under the EU definition of small- and medium sized enterprises. They do not have data scientists, market researchers, forecasters. They are small organizations with small research budgets and very little time for researching. Nevertheless, with more than 60 partners in 12 countries we have shown that this is possible:

we turned 700 million royalty statements into meaningful indicators about the price and volume growth in 20 European streaming markets;
calculated the value gap and the value of private copying in Hungary and Croatia;
helped closing the royalty gap in Hungary and Slovakia by helping collective management to significantly increase their royalty collection;

helped granting agencies to make more relevant grant calls and designed indicators to measure the impact of their grants;
started the creation of local recommendation engines that help the circulation of the small nation repertoires or city scenes in Europe or beyond.

Music Has Data, But You Need A Map

Scattered industries tend to be riddled with conflicts of interests. While working with royalty collection management societies in the last 7 years I often saw that songwriters, producers and performers are often fighting each other for slices of the pie that is just too small. That means that national members of CISAC (GESAC in Europe), IFPI, and AEPO-ARTIS often do not share data with each other, although their income is below any legally acceptable threshold. They have individually very rich datasets that in many jurisdictions just never meet. Labels, small publishers are so little organizations that they do not have a data scientist, let alone a dedicated IT person, or even an HR professional to hire the services of data scientists.

We were able to collect at least 70% of the information content of the planned European Music Observatory, and far more, than most of the 50 data observatories we examined in Europe, because we took an approach inspired in open source software development: continuous opt-in, opt-out data integration, focusing on the synergies that partners can achieve, instead of aiming at endless discussions and compromises on sharing data. We never take away proprietary data from anybody, we just connect data among partners, and enrich it with open data. We would like to guide the industry from hierarchical database planning to the philosophy of open collaboration.

We automated most of the research tasks, to make it less costly, less error-prone, and require less labour input. We can automate most of the data collection, data processing, imputation, validation, documentation, reporting, even some modelling.
We invested into harvesting the vast open data of the European Union and its member states. In the EU, most taxpayer funded research data is freely available, but at a cost of significant data reprocessing cost. If the data was originally collected to calculate to inflation or monitor tax revenues, it needs to be significantly altered for the music industry to be useful.
We have found a way to connect many small data sources and open data. We can create big data from much small data, and deploy analytics, algorithms on collective datasets.

Product/Market Fit Validation in Yes!Delft

Fri, 25 Sep 2020 15:31:39 +0200

We would like to validate our product market/fit in two segments, business/policy research and scientific research, with a supporting role given to data journalism. Because we want to follow a bootstrapping strategy, we must focus on those clients where we find the highest value proposition, which is of course easier said than done. We see much interest in our offering from other continents, therefore we truly welcome the opportunity that we can do this on a truly global business canvas in one of the worlds’ top five incubators, the number 2 university-backed incubator in the world, second to none in Europe, in the Yes!Delft AI+Blockchain Validation Lab.

In Europe hundreds of thousands of microenterprises, such as record labels, video producers or book publishers are facing data and AI giants like Google’s YouTube, Apple Music, Spotify, Netflix or Amazon. If the recommendation engines of these giants do not recommend their songs, films or books, then their investments are doomed to fail, because about half of the global sales are driven by AI algorithms. When they make a claim for the missing money, they will immediately find themselves in a dispute with gigabytes of data that they can only handle with a data scientist, even though they do not even have an IT professional or an HR professional to make the hire.

An awful lot of money, creativity and real values are at stake, and we want to be on the creator’s side, their technician’s side, their manager’s side when they want to get a fair share from the pie and they want to help these industry leader to make the pie grow.

The UNESCO and the EU have been promoting as an organizational solution the fragmentation problem with the so-called data observatories that are pooling the business, policy, and scientific research needs of various domains, like music. This is an idea that we really like, and we believe that our research automation solutions can help these observatories to grow faster as ecosystems, create better quality and more timely data and research products and a far lower cost.

We define ourselves as a reproducible research company inspired by the philosophy of open collaboration, based on open-source software and open data. We want to explore various revenue models around these ideas.

We are not committed to open source licensing if more permissive licensing policies provide us with better opportunities.
We would like to explore various data-as-service models, because we do not want to be locked into the position of cheap open data vendors.
We want to deploy AI applications that really help earning money in these sectors with playlisting, recommendation engines, forecasting applications, or royalty valuations, because our open collaboration approach brings up enough data sooner to than its alternatives, because it manages inherent conflicts of interests, fragmentation, and decentralization better than hierarchical solutions.

Timeline

In January CEEMID reached its peak: we introduced a 12-country reproducible research project made with only freelancers in Brussels, presented as best use case of evidence-based policy design.
In February Daniel visited the Yes!Delft Co-Lab to find out who would be the best co-founder to re-launch CEEMID as an enterprise.
In April we started to release our data as open data for validation.
One month ago we started-up.
Then we launched the music.dataobservatory.eu project.
A few other data observatories.

Bonus:

Palato in the Hague, where we took our selfie and had an absolutely amazing dinner after the pitch. Check them out!

First CEEMID Regional Open Data Release

Thu, 16 Apr 2020 17:00:00 +0200

Internet use: participating in social networks (creating user profile, posting messages or other contributions to facebook, twitter, etc.) [percentage of individuals] shows the development of social media use in the past 10 years in very high detail. Social media is one of the most important ways to communicate with fans and find audiences for gigs, performances and to share new releases.

The chosen dataset is highlighting several new priorities of CEEMID. This indicator, which is based on a Eurostat statistical product, has a much higher data quality than the Eurostat release, it is easier to use, and goes beyond the detail of national statistics. It contains data on 411 territories in Europe, including countries, provinces and smaller regions, even some metropolitan areas.

The dataset is available on the European open research data repository, Zenodo. It will be updated annually.

The processing information is available in the dataset. First, we have used our open source software to correct the regional boundary changes during the decade (see Programatic Approach To Work With European Regional Data Panels).

When data was missing in the end of the dataset, we used the last observation carry forward, when in the beginning, the next observation carry backwards data. Gaps in the data were interpolated using linear interpolation. Whenever data was available on a larger (provincial level), we imputed it to the smaller regional units.

The data contains standard national / regional references according the European NUTS2013 standard for backwards compatibility. Further documentation will be available on our methodology on the documentation.ceemid.eu wiki website.

At last, the data was put into a table that complies with the tidy data principles for easier processing on computers and immediate use in spreadsheet applications.

Use this in your article? Further research? Collaboration? Let’s get in touch on LinkedIn, Twitter, or via danielantal.eu

CCS Ecosystems: Evidence-Driven CCI Policy & The Central & Eastern European Music Industry Report

Wed, 29 Jan 2020 16:00:00 +0100

CEEMID & Consolidated Independent presented and discussed with stakeholders the Central & Eastern European Music Industry Report 2020 as a case-study on national and comparative evidence-based policymaking in the cultural and creative sector on the CCS Ecosystems: FLIPPING THE ODDS Conference – a two-day high-level stakeholder event jointly organized by Geothe-Institute and the DG Education and Culture of the European Commission with the Creative FLIP project.

Daniel’s presentation was focused around the question on invisibility of the CCI sector in the economic, education and labour policymaking, and the low level of data use in fact-based cultural policy design, and the following policy design problems. Our CEE Music Industry Report 2020 created with the help and support of Consolidated Independent was used as a use case for the problems.

This blog post is an edited version of Daniel’s presentation and the subsequent panel discussion with the stakeholders and organizers.

The CEE Report builds on the results of the first Hungarian, Slovak, Croatian and Czech music industry reports are compared with Armenian, Austrian, Bulgarian, Lithuanian, Serbian and Slovenian data and findings.

Invisibility

The measurement problems and the ‘invisibility’ of creative and cultural industries is a consequence of the fact that these industries are predominantly comprised of microenterprises and individual, freelancing entrepreneurs. Even larger entities, such as collective management organizations can be classified as small enterprises. In the EU, small- and medium enterprises, and especially microenterprises usually have reduced reporting duties to the statistical authorities and tax authorities (which is the most important secondary source of government statistics in anonymized, aggregated form.) This means that the supply side is not visible for policymakers. The recommendation is to conduct sample-based surveys among these microenterprises, but very few member states do that.

Another problem is that on the demand side, not all member states create statistics. ESSNet-Culture created recommendations how to measure cultural access and participation, which is a broader term than cultural consumption, as it includes non-market forms, for example, liturgical music, amateur acting, and so on. The European Commission sometimes makes excellent, but not detailed CAP surveys, which are the most important sources of Eurostat’s relevant pan-European statistics.

CEEMID has been making such surveys, both on the supply side (in music and film) and in the audience side (in music, film, theatre, opera, and artistic activities) in several member states, and has plenty of experience with using the EU-mandated CAP surveys of 2007 and 2013. The CEE report relies on the latter date set in first part of the audience analysis. Our work was already presented in 2015 as a best use case in Creating better national cultural statistics with Eurobarometer datasets and ESSNet-Culture technical recommendations at GESIS, which maintains the Eurobarometer archives, on the Eurobarometer Symposium Four Decades of Surveying Europe – Perspectives on Academic Research with the European Commission’s Eurobarometer Surveys

For the EU the lowest hanging fruit would be to critically assess the past surveys, including the partial CAP survey made in 2017 for the cultural heritage part of culture, and the national surveys conducted by CEEMID and its partners, and to mandate an annual or biannual CAP survey within the Eurobarometer series, probably as a specially sampled “Special Eurobarometer”. This would very significantly reduce the costs compared to a country-to-country basis, and probably could be shared by other institutions, for example, with the European Audiovisual Observatory. This alone would greatly increase the demand / consumption side information on the services of creative and cultural enterprises.

In the panel discussion Consolidated Independent highlighted the problem of leaving sample-based statistics making to the industry itself, which leads to myopical incentives to create ‘policy-based evidence’ that is cherry picked by industry trade associations to fit their often not very well thought out policy agenda. In our view, the most important role of a future European Music Observatory would be to set standards to data collection and integration. The music industry is one of the most data-rich industries globally, but the publicly available, verified, trustworthy information is scarce both for policy-making and for business planning among microenterprises who have know specialized research know-how. Our already existing, representative national surveys should and could be extended to the whole Europe with the quality control and visibility offered by such an Observatory.

Industry organization

A very significant challenge with evidence-based policymaking, or, in fact, with any policy making is that the extremely fragmented nature of the industry makes national and EU-level consultations very difficult. Most of the workforce is neither a classical employer nor employee but works as a freelancer or a micro-entrepreneur. Their views are very rarely represented by trade unions or employee associations or chambers of commerce. Despite all efforts on EU level to make the social dialogue more representative for atypical and flexible work forms, the problems and the views of the creative and cultural sectors are largely unrepresented in policy debate.

A prime example of this problem is the very heavy over-taxation of the music industry that we have shown in the Hungarian and Slovak national music industry reports, and in other documents in Croatia. The problem is not only characteristic for the music industry, but generally all CCIs because they share similar economic properties: no real chance to use tax breaks, high level of labour input and high level of value added. While policy makers and granting authorities spend much time on trying to improve the financing of this sector, in fact, reducing over-taxation would make a much more imminent impact on the liquidity, profitability and growth opportunities of the sector.

However, in the making of economic and tax policies, the fragmented creative and cultural industries hardly can represent their special situation.

Policy issues

Apart from taxation issues, which significantly reduce the liquidity, profitability and growth opportunities of these sectors in many EU countries, particularly in the CEE, where corporate taxes are low but value-added taxes are high, there are other important policy problem that reduce the long-term growth capacity of the sector.

The very small enterprise size leads to missing strategic human resources (HR) and research and development (R&D) functions in almost all enterprises – including simple market research activities. Companies with 1-2 employees do not have specialized management and support functions, and thus they have a very strong handicap in HR and R&D.

A good example of this problem is the motion picture and TV industry. These industries were comprised of medium-sized enterprises in the 1980s with significant in-house education functions. The current structure of these industries, however, resembles music, with almost all enterprises staying below the 5-person threshold. In our experience, based on development needs assessments in the Hungarian motion picture and the Czech music industry, this creates an acute skills and labor shortage. Missing skills cannot be well replaced by recruitment, or with strategic HR development via life-long learning.

Similarly to very reduced opportunities to participate in, and create life-long learning schemes, there are very little chances to engage in market research and R&D. While the music industry, for example, is one of the most data-driven industries in the world, the microenterprise size does not allow that these enterprises commission market research or hire data scientists. This leads to very asymmetrical relationships with the main distributors of music and media content on platforms that are owned by global data companies.

Recommendations

Daniel made a few concrete recommendations in the panel.

Creating the European Music Observatory, and the creation of similar industry initiatives, and commissioning collaborative (multi-stakeholder) market research, as CEEMID works in many countries, can only replace the missing market research function in the extremely fragmented industries, such as motion picture production, the music industry, but to a certain degree architecture and design.
A low-hanging fruit would be a critical assessment of the previous Pan-European CAP surveys and the comparable national CAP surveys conducted by CEEMID and its partners following the ESSNet Culture recommendations and the inclusion of the CAP surveys in an annual or bi-annual form in the Eurobarometer (Special) series. A Special Eurobarometer may be more suitable because usually a non-proportional weighting of the sample gives the best value for money in these surveys.
Critically reviewing the participation of micro-enterprises in the current forms of social dialogue and looking for formal or informal ways to increase participation in policy making can gradually lead to more creative-friendly economic regulation and tax policies. The Hungarian Music Industry Report 2015 and the Slovak Music Industry Report 2019 contains very interesting case studies for this problem that we briefly summarize in the CEE Music Industry Report 2020.
Critically reviewing the few examples from mainly Nordic member states where collective agreements and other collaborative institutions allow microenterprises and freelancers to participate in life-long learning problems can help designing policies that will gradually reduce the huge skill gap of the CCIs in management know-how, data know-how, or renew their technical skills necessary in the production of their services and content. Our work with the Hungarian National Film Fund and surveys among more than a thousand film makers can give much insight into this problem.

Further links

Our research findings were earlier presented and discussed in Vienna, Prague, Budapest and Bratislava with stakeholders.

You can follow Creative FLIP project on Twitter.

Czech Music Development Program & Comparative Market Research

Sat, 09 Nov 2019 11:00:00 +0100

I was presenting some highlights from the work we started with in the organization of SoundCzech with 25 music professionals representing more than 20 stakeholders in the How We Would Like To Work in the Czech Music Industry in 2020 ex ante evaluation workshop in the context of the comparative Central European Music Industry Report.

You can find the full presentation, including slides not shown in the workshop here. The presentation is a self-contained big file of 20Mb, takes time to load.

The work is done in a collaborative manner with the open Research Consortium started by SoundCzech, CEEMID & Consolidated Independent. We would like to invite any Czech stakeholders, or even individuals to join our efforts. Because in the music sector, all organization are microenterprise or small enterprise sized, they usually have no significant market research, innovation and strategic HR management capacities. We hope to give them in each country useful tools.

A very interesting part of the discussion in the morning was around transparency and potential conflict between stronger and weaker markets. Thank you for all colleagues who came on a Saturday morning after great showcase concerts the night before, and let’s stay in touch!

Private Copying in Croatia

Thu, 31 Oct 2019 12:00:00 +0100

Press release: Studija: Naknade za privatno kopiranje (BTL) u Hrvatskoj drastično ispod prosjeka EU

Short summary in Croatian: Privatno kopiranje u Hrvatskoj Full text in English: Private Copying in Croatia

Central European Music Industry Report Presentation

Mon, 30 Sep 2019 08:05:00 +0200

We had the first public and panel discussion of the forthcoming Central European Music Industry Report. After mapping and analysing in depth the music industries of several CEE countries, I put together with the help of Consolidated Independent and state51 a regional report in previously unseen detail.

You can review the whole presentation here (10Mb self-contained HTML file, takes some time to load).

After mapping and analysing (see most recently Slovakia) in depth the music industries of several CEE countries, with the help of Consolidated Independent I put together a regional report in previously unseen detail.

The live music part explains the different demography and other demand drivers of the CEE region for concerts, resulting in high seasonality, low venue profitability, an unusually high vulnerability of small venues – and as a result an unusually strong music festival scene.

For recordings, the report shows the royalty gap in comparison to Western Europe and the difficulties of labels and publishers to create value added to musicians. In the absence of a fully functional recording market, musicians are more reliant on collective management revenues than in the rest of Europe – yet in many countries collective management has profound difficulty in asking the correct price for music or collecting it.

When analysing the music flows among European countries, and the export-import flows of other emerging markets in Latin America and the worlds most stable ones, like that of the United States, Brazil and Japan, we must realize that these nations face an uphill battle to get into the better paying markets and at the same time to protect their domestic market from increasing import substitution.

Music grants could be an important tool to balance the disadvantaged position of CEE musicians in this global competition. Austria and Hungary has a strong popular music support program, but usually the availability and suitability of grants is lower in those countries where musicians and their technical and managerial team would need it most.

I am very grateful for the support given by Consolidated Independent in the making of this report. CI is the market leader in managed services for the digital music industry, connecting the best independent music with the opportunities of the global market. With their data science team, we put together data from about 700,000,000 royalty statement documents about the whole region. I believe that this is the first time that a global player releases large amounts of data to help understanding the changing music landscape in the era of digital streaming. Equally thankful for Franz Hergovich (Music Austria) for inviting us to discuss these findings on Waves Music Showcase Festival and Conference on 27 September 2019 with Márton Náray (SoundCzech) and Péter Benjámin Tóth (Artisjus). And of course, the most important people to thank for are the more than 2000 musicians, managers and technicians who participated in the CEEMID Music Professional Survey, which is one of the main data sources of this report, where no other information was available. You can find out more about the data sources here. The report will be shortly released in a free downloadable ebook, and musicians, who requested it, will receive their personalized mini-reports shortly.

All feedback is, as always, welcome.

Slovak Music Industry Report

Tue, 26 Mar 2019 00:00:00 +0100

The whole report can be downloaded for free from the homepage of SOZA.

Press reports in Slovak:

SME: [SOZA predstavila prvú Správu o slovenskom hudobnom priemysle](Čítajte viac: https://domov.sme.sk/c/22084685/soza-predstavila-historicky-prvu-spravu-o-slovenskom-hudobnom-priemysle.html)

Kreatívna Europa: Historicky prvá Správa o slovenskom hudobnom priemysle prináša okrem analýz aj odporúčania pre budúcnosť

In Hungarian: Új Szó: Tudományosan a hazai zeneiparról

Slides

Spáva o hudobnom priemysle na Slovensku from Dániel Antal