www.musexfinland.fi

FINNISH MUSIC EXPORTS: BEHIND THE SUCCESS

UU Cultural Development & NICEC Study Visit to FinlandPaulina Ahokas / Music Export Finland, June 21, 2006

I. What is Music Export Finland II. Development of Market Value of Music Exports 1999-2004III. Music Industry Income StreamsIV. Key Factors Behind the SuccessV. How to Sustain the GrowthVI. How Music Export Finland Operates

+ some music for your ears…

www.musexfinland.fi

I. WHAT IS MUSIC EXPORTFINLAND

• An export association representing the entire Finnish music industry– Members all the key trade associations:

• Composers´ Copyright Association Teosto• Neighbouring Rights Association Gramex• Light Composers’ Association Elvis• Music Publishers´Association• IFPI Finland• Independent Producers´ Association IndieCo• Musicians’ Union

• Initiates and facilitates the marketing, promotion and sales of Finnish popular music abroad – Works with professional companies only

www.musexfinland.fi

II. DEVELOPMENT OF MARKET VALUE OF MUSIC EXPORTS 1999 - 2004

1 8

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5 000 000 €

10 000 000 €

15 000 000 €

20 000 000 €

25 000 000 €

Products Services Royalties Aggregate Value€ 1999 € 2000 € 2001 € 2002 € 2003 € 2004

Average AnnualGrowth

ca. 26 %

www.musexfinland.fi

III. MUSIC INDUSTRY INCOME STREAMS - Exporters / Music Industry Professionals

Teosto ry/NCB

Blank Media Levy

Gramex ry

AV Producers

InstrumentManufacturers

Ring Tones

Digital Formats

R

R

TO

TO

LV

TO

-Mechanical Royalties -Public Performance

-Import

-Wholesale

-Retail

-Mail Orders

-Ring Tone Retail

-Live Promoters

-Festivals

Customers

Tax, TV License

Channel Fees

Entrance Fees

Records

Synchronization

Instruments

Sheet Music

Ring Tones

Tickets

Grants, Royalties Government and Public Organisations

-Composers

-Lyricists

-Arrangers

-Translators

-Musicians

-Soloists

-Conductors

Grants, Royalties Private Organisations: LUSES, ESEK etc.

FOREIGN COUNTRIES

(Modified from source: Teosto ry 75 years”Anna mulle tähtitaivas” )

Record Companies

Agencies

Publishers

ManagementsTO

TO

TO

(R=Royalties, TO=Turnover)

www.musexfinland.fi

IV. KEY FACTORS BEHIND THE SUCCESS

• Internationalization of Finnish culture– Geopolitical changes: collapse of trade with the Soviet Union, joining the EU

and implementation of Euro– Education: language skills, dynamic educational strategies– Economical changes and increased travelling (Interrail!)

• Investment to the basis of the value chain– Musical education = Product development

• Basic structures in place– Copyright legislation and administration– Taxation– Healthier business environments for companies

• Versatility and originality of Finnish culture (= content)– Isolation and slow pace producing possibility for development

• Maturity of music business professionals– Pioneers– Generation change within companies– International awareness

Results in predominantly domestic (58%) repertoire!

www.musexfinland.fi

Key factors behind the success (cont’d)

• Competetive/low production costs• The facilitation of communication structures through

technological innovations– Relatively easy to implement new technological structures and

innovations– Finns eager to learn and to apply new innovations

IV. KEY FACTORS BEHIND THE SUCCESS

www.musexfinland.fi

Key factors behind the success (cont’d)

• Breakthrough artists (i.e. Bomfunk MC’s, Darude, HIM, The Rasmus,, Nightwish) lead to increased interest in the international music market to Finnish artists and their representatives

• And at the same time, hunger and ambition within Finnish artists and their representatives grows

IV. KEY FACTORS BEHIND THE SUCCESS

www.musexfinland.fi

V. HOW TO SUSTAIN THE GROWTH

• More focus on marketing, communications and access– How do people consume music in the future – and now

• More know-how within music companies• The introduction and implementation of courageuos new

business models in the Finnish market and within Finnish music companies

• The need to be in the avant garde of music & technology, and specifically, mobile music

www.musexfinland.fi

VI. HOW MUSIC EXPORT FINLAND OPERATES

i. Internal Marketing

Finnish Music Companies - activation, consultation, development of operational frameworks

Development of exporting support systems - commissioning of market research

www.musexfinland.fi

ii. External Marketing

Market Research- product specific- contact database

Personal Selling- In co-operation with the companies

Promotion- Business-to-business publications

- Music Channels

Advertising and Direct Marketing- Internet, E-mail

VI. HOW MUSIC EXPORT FINLAND OPERATES

www.musexfinland.fi

iii. External Marketing (cont’d)

Sales Materials and Co-promotion- Sales promotion tools (Electronic and physical)- Production and distribution of CD-compilations

Co-marketing and Showcase Production- Professional Trade Eventse.g. Eurosonic, Midem, Canadian Music Week, South By Southwest (SXSW), MusExpo, Sonar, In The City (ITC), Popkomm, MusicWorks, Access All Areas etc.- Showcases and Tourse.g. Finnish Music Day in Tokio, primary European Destinations (London, Berlin, Paris) etc. - Co-organized tour entities

Networking Events in Finland and Abroad

VI. HOW MUSIC EXPORT FINLAND OPERATES

www.musexfinland.fi

And some music…

• Apocalyptica• The Rasmus• The Crash• Nightwish• HIM