Music Canada, our nation’s leading music industry advocacy organization released an impressive report at Canadian Music Week that outlines policies and programs designed to stimulate the economy by developing Canada’s music industry.

The report describes the impact that our music industry has on the national economy, and identifies 5 key areas where we should be focusing our development efforts. It also includes 17 specific recommendations.

It’s encouraging to see how much the music sector contributes financially to the well being of our country. Kudos to Music Canada for accepting the realities of the industry, and putting together such a forward-thinking report.

Here are some of the highlights from The Next Big Bang: A New Direction For Music in Canada.


Economic Contributions of the Music Industry

The Music Canada report threw out some economic numbers that blew my mind:

–       Arts & culture contributes $46 BILLION to the Canadian economy. That’s three times the insurance industries, and twice the size of forestry. That’s 600,000 jobs.

–       Major & indie music companies made expenditures and investments exceeding $398M in 2011.

–       That generates more than $178M in wages, $43.5M in tax revenues, and sustains over 4100 jobs.

–       It also results in a contribution of $240M to Canada’s GDP.


Reality of Commercial Music in Canada

The report states some important facts about the state of our current industry:

Digital Consumption is Driving Change Digital sales account for nearly half the market. The shift to digital comes with its challenges, such as ensuring artists are being compensated fairly for their work.

Music Companies Continue to Invest in A&R Despite declining revenues, music companies are still investing 16% of expenditures on A&R.

Live Perfomance Becomes an Increasingly Important Source of Income Due to digital piracy, performing has become crucial for an artist to reach audiences, develop fans, and earn an income.

Marketing Evolves in the Online Environment- Music marketing has shifted “dramatically” in the digital era. Successful marketing campaigns are taking full advantage of social media to connect with fans not only in Canada, but around the world.

Discovery Moves Online More and more audiences are discovering new music using the internet. According to a CIMA study, “whereas consumer discovery of new artists traditionally took place in the domestic market via radio broadcasting, that medium increasingly exhibits more established Canadian artists (generally in order to satisfy Canadian Content regulations). Accordingly, consumers’ discovery of new artists is now derived using social media … in addition to through live performance.”


5 Key Areas to Focus Development & Recommendations

The meat of the The Next Big Bang is in its outlining of 5 specific areas where we should focus of development efforts in the digital age, and some recommendations on how to do so:

Music-Canada-LogoMusic Education

– Provincial governments need to make a conscious and significant investment in music education that supports a 21st century curriculum, provides properly trained teachers, and incorporates technological advancements in the teaching tools.


Digital Innovation

– More fluid funding, allocated according to criteria that reward a constant push toward finding innovative ways to do business, should be implemented and would help secure a place for Canada on the leading edge of digital innovation.

– Design models that support the discovery of Canadian music online through partnerships and strategic initiatives. Efforts dedicated to innovative technologies that support Canadian talent should be favored over those that are tied to old technology or which support of services that do not promote Canadian music.


Music Tourism

– Implement a Commit – Measure – Broadcast strategy for all music tourism stakeholders. Ensure this model incorporates measurement tools, is open to review to ensure best practices are implemented, and ensures optimal deployment of resources.

– Stakeholders in the commercial music industry are experts at fan engagement and community building. This expertise should be leveraged to build and engage with a community of active music tourists.


Export Expansion

-Funding should be provided to enhance Canada’s music industry representation in Los Angeles, to support export growth to the U.S., Canada’s largest music export market, and to attract additional recording activity to Canada’s world class recording studios.

– Consideration should be given by cities, provinces and the federal government to appointing musicians to act as good-will ambassadors to the world and involving them in trade missions. This is something Austin has done to great effect.


Interconnected Tax Credits

– Artist and Repertoire development needs to be treated in the same manner as R&D in other intellectual property industries, to ensure sufficient dedicated funding is available for artist professional education.

– Similar to the film and TV industry in Canada where there are tax incentives for both Canadian and foreign-controlled companies, existing music tax credits and any new tax credits, should be expanded to go beyond support of domestically owned companies. They could be constructed to provide incentives for foreign-owned companies to further invest in using Canadian studio facilities, undertaking the associated music videos in Canada, and employing the music eco-system of sound engineers, graphic artists, music videos, marketing services and the like.


This was a very interesting read, and if you’re at all interested in the business of music, or the future of the Canadian music industry, I would highly encourage you to check out the full report!