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«COUNTING THE NOTES The economic contribution of the UK music business A report by the National Music Council – November 2002 Preface This is the ...»

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Equating this to 18,000 full-time equivalent employees and using the average employment costs disclosed in the accounts of eleven leading retailers for periods ending in the year 2000 indicates industry employment costs of £265m for that year. Calculating total value added for the sector is more difficult, given the difficulty of isolating the appropriate proportion of operating profits and/or losses attributable to music products in the companies which have a mixed retail offer.

Overall, accounts-based analysis indicates a total value added for the sector for the year 2000 of £342m, a figure somewhat depressed both by start-up losses of some internet retailing ventures and losses incurred by some hitherto profitable companies which were re-shaping their businesses.

7.3 Distribution

The UK music distribution sector comprises a variety of enterprises which are engaged in bringing music products from record labels to the retailers who sell to end consumers. The most high profile companies engaged in the sector are probably the distribution divisions of the major record companies, which have acted historically as the exclusive sales and distribution conduits by which releases from the major labels have come into the market, plus that of any independent labels which the majors distribute. The ownership of a dedicated wholly-owned distribution wing was for many years seen as a key element of the system of vertical integration which underpinned the majors’ operations, and in the 1990’s EMI, Universal and BMG all moved to new distribution centres. However the launch in April 1999 of The Entertainment Network (TEN), a joint venture between Sony Music Entertainment and Warner Music, indicated a new attitude towards physical distribution and more recently it has been suggested that the majors may no longer see the ownership of their own distribution company as a necessary part of their business.

The major distributors, TEN, Universal, EMI and BMG, represented just under 85% of the primary distribution market for albums in 2001, with product including that of some significant “indie” labels such as Ministry of Sound, Independiente and Telstar as well as that of their own labels. Alongside the majors, the primary distributors include a number of significant independent companies such as Pinnacle and Vital and a number of companies specialising in particular types of music such as Select (classical), Proper (folk, jazz and roots) and Southern (dance). The independent sector has also seen a number of significant changes in recent years. These include a move from some long-established companies, notably Vital and Koch, out of the process of physical distribution to concentrate purely on the sales side of their previously integrated businesses. Meanwhile much of the growth for Pinnacle, the independent sector’s market leader, has come from the sale and distribution of computer games.

Alongside these primary distributors, both major and independent, the sector includes some significant secondary distributors, with particular specialities for example acting as exclusive supply channels for particular large retailers, as “one-stop” suppliers for small retailers, or as sellers to non-traditional retail outlets. These companies include Entertainment UK, Total Home Entertainment and Handelman UK.

These three companies alone disclosed turnover of close to £950m in their accounting years ending in 2001, though this comprised not only music products but also videos, DVDs and computer games.

The distribution sector also includes wholesalers engaged in trading music products, often with a specialism in a particular area, eg buying and selling overstocks or importing chart albums. Since the mid

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Traditionally, and deriving in part from the UK’s vitality as a creator of repertoire for the world market, there has also been a healthy music export sector, based around companies such as Lasgo Exports, Caroline International, Windsong International and Lightning Export. This sector has however become less profitable in recent years due in part to changes in exchange rates and the growth in the significance of local repertoire in many overseas markets. Consequently there have been several corporate reorganisations.

7.4 Distribution - employment and value added

It is difficult to ascertain with precision the number of those employed in the music distribution sector and its value added, as it is not possible easily to divide the results of the key companies in the sector into music and other entertainment products. Analysing the published accounts of the key distribution companies, in the light of their relative roles in the market indicates that in 2000 the number of employees attributable to music products was approximately 3,500, and they generated value added of £114m.

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For amateur musicians, participation in music is a central part of their lives and identity. Amateur musicians contribute economically as consumers of the tools of their craft -- musical instruments, sheet music, and music education and as well as consumers of music made by others. Amateur musicians perform, produce, record, travel, and participate in festivals. The majority of performers, even those who collect occasional earnings from music, are officially amateur musicians. Because they earn the majority of their income in non-musical pursuit these important members of the musical fabric of the country report another occupation on census forms and are not included in government numbers.

Music, perhaps more than any other performing art, presents a complex picture in which the professional and the amateur are interdependent. Francois Matarasso in his lecture Value and values in the voluntary arts said that “our conventional thinking about amateur and professionals is simply inadequate to understand the rich, complex and often contradictory arts ecology that currently thrives in Britain.” He illustrates his argument with several examples from the world of music, such as the Wexford Opera Festival and the St Endellion festival in Cornwall, where amateurs and professionals work together – these professional events would not exist without the amateur input. Joining In, Anthony Everitt’s 1997 “Investigation into Participatory Music” observes that amateurs and professionals “increasingly occupy a broad interactive spectrum of practice. It is important not to see this development as some kind of revolutionary innovation. Collaboration and partnership in the music industry between amateurs and professions has always been part of the fabric of music, all over the world.”

8.2 Audience trends

In the field of classical music, there are limited data on audiences. For example, it is difficult to assemble figures even for audiences for the major English and Scottish orchestras. The orchestras collect figures for the concerts they promote themselves, but do not record attendance at concerts where they are engaged to play by other promoters. Various estimates have been made though none recently – for example, the BBC/ACE enquiry (1994) into orchestral music estimated total attendances at classical music concerts at 8.5 million per annum which represented 3.7 million people attending on average 2.3 times a year.

Developing an up-to-date estimate for total audiences requires market research data. The British Market Research Bureau’s Target Group Index (TGI) is a survey measuring amongst other things people’s leisure activities and purchases. The TGI is compiled from an unusually large sample – about 25,000 adults, and some of its results are published in the Advertising Association’s Lifestyle Pocketbook.

Individuals are asked if they attend a variety of events, including all types of concerts in all sorts of venues, including amateur productions. The following table shows that, in 2000, 11.6% of those questioned described themselves as ‘current attenders’ at classical concerts. This represents attendances of 5.6 million.

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7.3 5.8 33.4 3.6 15-24 7.5 5.4 36.3 4.9 25-34 10.0 6.4 31.0 5.7 35-44 14.3 6.1 22.0 7.6 45-54 17.5 8.8 8.1 9.4 55-64 14.2 4.4 1.4 7.7 65+

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Determining accurately how many people participate in making music is difficult. Two possible methods are through analysis of membership of relevant societies, clubs and organisations or, again, reliance on market research, with the usual reservations.

The last attempt at a comprehensive membership report was completed in 1991. Amateur Arts in the UK found there were more than 5,400 amateur music-making groups within 9 umbrella organisations, with a total individual membership of 258,000. This included: 240 youth choirs and orchestras, (with membership of more than 28,000); 1,700 folk or traditional music and dance clubs or societies, membership of 57,000; and 260 music-promoting societies, (membership 36,000). The National Operatic and Dramatic Association estimates in 2002 that it has in membership about 1,380 operatic societies.

Making Music had at the end of 2001 approximately 343 promoting groups and 1,612 performing groups in membership, with a combined participation figure of around 138,000 people.

The ABRSM report Making Music 2000 (not to be confused with Making Music the umbrella group) surveyed instrumental music making for both children and adults in 1999. Results for children are referred to in the Education chapter of this report. Very similar surveys were conducted in 1993 and 1996, and therefore a comparison over time is possible. The percentage of adults (here defined as age 15 and over) who can play musical instruments varied over the three surveys.

1993 26% 1996 30% 1999 24% The most popular instruments played were piano (42% in 1999); recorder (20%); electronic keyboard (15%); classical guitar (15%) and electric guitar (13%).

79% of adults surveyed in 1999 had taken music lessons at some time, but only 6% were currently doing so. These figures had changed little over seven years.

Various surveys have been carried out by the three Arts Councils (Arts Council of England, Scottish Arts Council, Arts Council of Wales) on participation in music-making. Arts in England – Attendance, Participation and Attitudes reports on a pilot survey of 1,309 people. Although this is a relatively small sample, a larger survey underway in 2002 indicates that the sample is broadly representative. This report shows a much lower percentage playing musical instruments than is indicated by the ABRSM survey, perhaps because it is querying playing in a specified time period instead of within lifetime. It is possible that the variation is a function of the survey questions – some of the ABRSM respondents may have meant that, at one time, they played an instrument.

Table 8:3 - Percentage taking part in music-making, England Those taking part in musical activities During last 12 During last 4 weeks months Play a musical instrument for own pleasure Sing to an audience (or rehearse) Play a musical instrument to an audience (or rehearse) Write or compose a piece of music Perform in opera or operetta Source: Arts in England, ACE Feist A & Hutchison R (1991) Amateur Arts in the UK London: Policy Studies Institute.

– page 50 Counting the notes – the National Music Council report on the economic contribution of the music business The most recent survey from Scotland dates from 1998 (Scottish Arts Council, unpublished). Asked whether they participated in musical activities twice a year or more, 9% of adults said they played a musical instrument, 4% took part in folk and Scottish traditional music and 3% sang in a choir or other amateur musical group. The Arts Council of Wales annual Welsh Omnibus Survey, conducted by Beaufort Research, asked simply (in 2001) “How often these days do you take part in music of any kind?” 11% of those aged 16 and over said that they ever took part in music, and of these 3% took part once a week or more often. These results are as yet unpublished.

Some of these surveys follow the standard market research practice of breaking down respondents into groups by gender, age group and social grade, however the numbers involved are so small that the percentages may be misleading.

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This section outlines music in schools, both in the classroom and as an extra-curricular activity, music as a leisure activity for young people, and music in higher education, as an academic discipline and a training for a performing career. The careers of music teachers are also considered, and reveal a complex pattern of private teaching, teaching via statutory education services and performance.

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(a) State schools for pupils who for various reasons cannot be placed in mainstream education.

Up to the age of fourteen, all children study music in schools as part of the National Curriculum. In practice, this means that students receive a minimum of one hour’s classroom tuition per week in performing, composing and listening.

In primary schools (children aged 4-11), music lessons are generally given by classroom teachers who are not, normally, music specialists. In some primary schools the musical experience will be a rich one, in others, where teacher expertise is lacking, it may well be much less so. There has been significant study on the need for more in-service training, more specialist teachers, and more thorough teacher-training in music, especially at the primary level.

After age 14, secondary school students (students aged 11-16 or 18 where students take A level examinations) have the opportunity to choose to continue music education. Music is taught by a specialist teacher, usually classically trained, in a dedicated music classroom. Each year, about thirty thousand 16-year old students take GCSE music. They are have coursework and are tested in listening, performing and composing. Some schools also offer a General National Vocational Qualification in the performing arts, with music as the specialist pathway. This course covers much of the same ground as GCSE but includes real life, work-related projects based on allied subjects like marketing, box office management, production and the study of business skills directly related to musical careers.

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