Nigeria has a strong entertainment industry which has spread beyond its borders into the African region and African diaspora markets in the UK and the US. The industry is comprised of both music and film production. The music industry produces an average of 550 albums of different types of music annually. Record sales have more than tripled in the past 5 years, averaging 10 million in 2005 and rising to an estimated 50 million in 2010.
There is revenue from musical shows and concerts held in Nigeria. An estimated 1200 concerts and musical shows take place every year and account for a combined annual turnover of US$105.5 million (chei! Okay that’s real cash). The entertainment industry in Nigeria offers potential for growth and value addition for the Nigerian economy. Although in the context of GDP contribution, the sector is not large, there are other factors to support its inclusion in the strategy plan. The popularity of the industry makes it worth exploring. However, it faces some challenges. The biggest of these is piracy in both the film and music industries. Estimates indicate that for every single copy of film sold legitimately, there are 5 to 10 copies sold by pirates. Other challenges include poor production standards and poor marketing and distribution linkages. These challenges have discouraged financial investment in the industry. Although the quality of production is poor, estimates of the scale of consumption of pirated copies throughout the region and the diaspora prove that there is a volume of sales that Nigeria could capture that is currently lost to piracy. The International Music Marketplace, The recorded music industry has traditionally derived the majority of its revenues through the sales of physical recordings. However, the rise of digital music has resulted in substantial changes to the industry’s structure as shown in the table below. Recording companies have adapted their approach to respond to new trends in how music is distributed and consumed. There is still a market for physical recordings such as albums, single sound recordings and music videos. Digital distribution refers to distribution of music to mobile phones and music downloads through the internet. There has been an increasing shift from CDs to music downloads. Global digital music sales reached US$10.6 billion in 2010 and are projected to increase to US$24.8 billion in 2013…, an annual increase of 18.2%. Local Capability and Competitiveness of the Music Industry Exports of Music Nigeria has fashioned an African Hip Hop style of music which appeals to international audiences. A number of its musicians are internationally recognised and have received international recognition through awards such as the MTV Europe Music Award, Channel O Music awards and Kora Music awards. These awards have been received for various musical talent categories as well as other areas such as best video and special effects. In 2008, the industry had 30 million legal record sales with a value of just over US$9.3 million (na so so moni be this???) while concerts and music shows generated an annual turnover of US$105.5 million. Pirated music sales are estimated at 30 million but the impact of these sales in lost revenue to the industry is difficult to estimate because no one knows the price at which pirated music is sold to the regional and diaspora market. It is not certain how many people are employed in the music industry because it is fragmented and mostly informal, but it is estimated that by 2018, the industry will have the capcity to employ half of Nigeri’s youth population.