Icelandic Music Industry in Numbers - Mapping Exercise

Icelandic Music
The Icelandic Mapping Exercise

Key findings

• This is the first attempt to present the Icelandic music industry in numbers. Accurate information regarding the industries size, its export and airplay performances are not available.
• The industry is very small. In 2001 approximately 740 thousand copies of sound recordings were sold at distributor level.
• An awareness of the economic as well as cultural importance of the music industry has been growing for the last decade.
• The value of the domestic record sales at retail level increased by almost 50 percent between 1991 and 2001.
• At the same time the value of domestic sales at distributor level has increased by almost 85 percent and the value of foreign sales by only 40 percent. The increase in domestic market share has resulted in the market being split equally between foreign and domestic releases.
• More and more individuals or small companies are releasing sound recordings than before. In 1992 56 titles were released by other than the main record companies. In 2000 this number is 125 titles, which are 62% of all released titles.
• The market is divided between one large record company and 3-4 small ones. Skífan, the largest, has distributing rights for EMI-Virgin, Sony, Universal, BMG and Warner Music, which together with Skífan’s domestic labels held approximately 80% market share in the year 2001.
• Skífan sold 68 percent of the total copies sold ore 505 thousands copies at the value of 5.9 million USD .
• In 1995 roughly 69% of pop concerts took place in the capital region, and 57% in 1999.
• It seems that lack of competence accessing capital or other support is as well as lack of supportive institution explain why actors within the industry have not reached a higher level of professionalism.
• In May 2002 the Trade Council of Iceland hosted a conference for the music industry. By hosting this conference they marked the beginning of cooperation between the Trade Council and the music industry. The conference initiated the formation of an organization, Samtónn, within the industry, that is meant to unite the divided industry into one organization. Samtónn is expected to be the voice of the industry vis-à-vis the government and institutions.
• In March 2003 the Trade Council is going a step further and initiating a seminar with key actors within the industry. Participants will come from Samtónn, the record companies, artist societies, the ministries mentioned above and the Federation of Icelandic Industries. The purpose of this meeting is to reach common ground in industry affairs, to make it more strategic
• In 1995 roughly 69% of pop concerts took place in the capital region, and 57% in 1999.
• A new legislation regarding the industry is being written. Within the music industry people are hopeful that this legislation will improve the environment for musical activities by increasing support for artists within popular music.

The Icelandic music industry - Mapping exercise

Introduction

An awareness of the economic as well as cultural importance of the music industry has been growing for the last decade. A forum for discussions regarding the industry has emerged, and the music industry is receiving more attention than before. New music laws are being written, the Ministries of Commerce and of Education and Culture are increasing their cooperation in music industry affairs, and the Trade Council of Iceland has decided to devote considerable attention to the industry in the nearest future. Still much more remains to be done; the music industry needs to be defined as an industry equal to other industries with the same access to capital and institutional support.
The Icelandic music industry is younger, smaller and less developed than the music industries in for example Great Britain, and Sweden.. Therefore information, statistical as well as other information were often hard to find. There are no export figures available regarding the music industry, information regarding the size of the industry is lacking, and accurate statistics regarding airplay performances are also not available. Apart from two overviews of the industry released in 1997 and 1999 this is the first attempt to map the music industry in Iceland
Accessible information regarding the industry is likely to be an important step in making the industry more professional, increasing the understanding if the industry’s needs and hopefully improve its performance.

Institutional set-up

The Icelandic music industry has not enjoyed a strong institutional support system in the past, but given the increased interest taken by governmental institutions recently, this may be changing. Over the last few years institutions such as the New Business Venture Fund and the Trade Council of Iceland have involved themselves in music industry affairs by consulting them in matters of export, raising capital and marketing their product. It is likely that, paralleled to increased support from institutions as well as venture capitalists, the music industry will become more professional than before, which in turn is likely to improve its performance. The institutions and industry organizations listed in Table 1 have not necessarily been involved in the music industry in the past but, given recent developments, are likely to become of importance to it in the nearest future.

Table 1. The institutional set-up
Supporting institutions
The Ministry of Industry and Commerce
The Ministry of Education, Science and Culture
Trade Council of Iceland
Technological Institute of Iceland (IceTec)
The New Business Venture Fund

Industry organizations
The Federation of Icelandic Industries
Performing Rights Society of Iceland (STEF)
collecting society for performing artists and phonogram producers (SFH)
Icelandic Musicians’ Union (FÍH)
Collecting Society (IHM)
The Icelandic National Group of IFPI (SHF)

Music festivals
Iceland Airwaves
Músíktilraunir

Supporting institutions

The Ministries of Industry and of Commerce
The Ministries of Industry and of Commerce in Iceland are, according to law, two ministries sharing one minister. Their main activities are, for example: industrial matters, industrial development and innovation. The ministry has stated that it will encourage industries based on intellectual property, such as the film and music sectors, in the future. Furthermore it has announced that a development fund will be established for the music industry, the main objective being to increase the export value of Icelandic music. In 1995-2002 the Ministry of Industry and Commerce has allocated approximately US$500,000 to the music industry.

The Ministry of Education, Science and Culture
The Ministry of Education, Science and Culture administers musical activities. The Ministry has in the years 1995 to 2002 allocated approximately US$100,000 to popular music. Under the Artists’ Grants Act no. 35/1991 the Ministry granted US$3.1 to four different artists’ funds in 2001. One of those four funds is the musical composers’ fund, which receives approximately 8 percent of the total sum, or just over US$245,000. Apart from these grants the Iceland Symphony Orchestra receives an annual sum from the national Budget. In the 2002 that sum is just under US$3 million. It is evident that what has been categorized as “popular” music receives only a fraction of the support allocated to classical music. New legislation regarding the industry is in preparation. Within the music industry people are hopeful that this legislation will improve the environment for musical activities, by increasing support for artists within popular music.

Technological Institute of Iceland (IceTec)
IceTec is an Icelandic service center for small enterprises and entrepreneurs. It is owned by the state and supervised by the Ministry of Commerce. IceTec aims to strengthen the Icelandic economy through development, innovation and increased productivity. Acting in close cooperation with industry, the institute focuses on R&D, technology transfer, education and consulting to increase innovation, productivity and competitiveness.

The New Business Venture Fund
The New Business Venture Fund is an independent entity owned by the state. Overall supervision of the Fund is in the hands of the Minister of Commerce.
The role of the New Business Venture Fund is to encourage development and growth in all sectors of the Icelandic economy through participation in innovation-oriented investment projects and support for development and marketing projects. For this purpose, the Fund may advance share capital or make loans, guarantees or grants. For a long time companies within the music industry did not receive any support from the New Business Venture Fund. Recently that has changed, and two record companies have enjoyed the fund’s support for the last few years.

The Trade Council of Iceland
The Trade Council of Iceland assists Icelandic companies with marketing their products, services, and know-how in the international marketplace. The Trade Council provides a range of practical business information, organizes and implements marketing and trade missions, and hires local marketing and sales consultants to assist them for limited periods of time. In May 2002 the Trade Council of Iceland hosted a conference for the music industry. By hosting this conference they marked the beginning of cooperation between the Trade Council and the music industry. The conference initiated the formation of an organization, Samtónn, within the industry, that is meant to unite the divided industry into one organization. Samtónn is expected to be the voice of the industry vis-à-vis the government and institutions. In March 2003 the Trade Council is going a step further and initiating a seminar with key actors within the industry. Participants will come from Samtónn, the record companies, artist societies, the ministries mentioned above and the Federation of Icelandic Industries. The purpose of this meeting is to reach common ground in industry affairs, to make it more strategic.

Industry organizations

The Federation of Icelandic Industries (FII)
The Federation of Icelandic Industries (FII) is the main organization of Icelandic employers in manufacturing industries, crafts, software production and related services. Membership consists of nearly fifteen hundred enterprises, ranging from small family businesses to Iceland’s largest industrial companies. Its mission is the creation of a more favourable climate for industrial enterprise in Iceland, and supporting its interests at home and abroad. The Federation of Icelandic industries (FII) offer various services to members and strive continually to improving contact between the organization and individual members by, among other things, arranging meetings for member societies. Participating with member companies in collective bargaining. Advising member companies on a wide range of issues such as: education, legal matters, marketing quality control, technological development, taxes, environmental issues and more. The music industry has not been a part of FII in the past. Last spring a representative from FII participated in a conference regarding the music industry. They introduced their organization and the service available at the conference, which may results in cooperation between the music industry and FII.

Collecting societies
There are three separate collecting societies in Iceland:

IHM is a collecting society for authors, performers and producers. It collects remuneration for the sale of blank audio and video media and hardware, used for reproduction of material protected by copyright, and distributes this to rights holders.

Fjölís is th Reproduction Rights Organisation in Iceland. It concludes agreements with users of protected materials which are used by photocopying. Fjölís collects fees for these uses and distributes them to the rights holders organisations
SFH is the Collecting Society for Performing Artists and Phonogram Producers.

STEF is a collecting society for lyricists and composers. By joining STEF, an originator transfers to STEF its legal rights to royalties for public performance and recordings. In return STEF is responsible for ensuring that anyone performing and recording music has a license to do so and does so according to law. NCB, a Nordic mechanical copyright society that works on behalf of the national performing rights societies in the Nordic area, safeguards mechanical rights to musical compositions on behalf of composers, lyricists etc. and music publishing houses. These rights cover the right to record music, manufacture copies and distribute copies.

Table 2. Income of royalties in Iceland 1999 and 2002. Million USD

1999 2001
Radio, TV and other public performances (STEF) 129 162
Mechanical rights (NBC) 19,2 24
Total 148,2 186
Source: Based on an interview with an industry representative.

Music festivals

According to the number of musical events in the recent years Icelandic music life is quite prosperous. The two events listed in table1 are probably the most important music events for popular music. Músiktilraunir (Music experiment) is a sort of a garage band competition. It is a place where energetic young bands come together bringing fresh breeze into the music scene every year. It is the a place (vettvangur) of musical innovation. Many successful Icelandic bands have started their career at Músiktilraunir.
Iceland Airwaves has been the biggest event of the music industry for the last four years. It started out as a showcase for local Djs but has evolved into an annual music festival, which attracts an international crowd of concertgoers, journalists and music industry representatives. Iceland Airwaves presents the highest quality and cutting edge music that is currently happening in Iceland. Many of the bands have or are releasing records either independently, through Icelandic record labels or have contracts abroad. Airwaves 2001 hosted more than 60 Icelandic artists in numerous venues in downtown Reykjavik of diverse musical styles from Hardcore Metal to Ron’s, Hip Hop to Lo-If and Jazz to India-Rock. Airwaves has participated in promoting bands like Sigurrós, Leaves and Quarashi. The later two have both signed on with big labels abroad.

Record Sales

The value of domestic record sales at retail level has increased by almost 50 percent between 1991 and 2001 (table 3). The value at distributors’ level or wholesale has increased even more, or approximately 60 percent between 1994 and 2001 . At the same time the value of domestic sales at distributor level has increased by almost 85 percent, and the value of foreign sales by only 40 percent. The increase in domestic market share has resulted in the market being split equally between foreign and domestic releases. The explanation is partly due to robust sales of local compilations including mainly international repertoire but categorized as local releases. Another explanation may be that Icelandic consumers are more reluctant to make illegal copies of Icelandic music than of foreign music. Also it is possible that a strengthening music scene in Iceland has caused a change in consumer behaviour in favour of domestic music.

Table 3. Value of Icelandic record sales 1991-2001. Million ISK.

Retail value Sale value at Distributor level Percentage
Total Domestic Foreign Domestic Foreign
1991 883 ... ... ... 32 68
1992 740 ... ... ... … …
1993 600 ... ... ... … …
1994 860 460 195 265 42.4 57.6
1995 994 530 240 290 45.3 54.7
1996 1100 610 285 325 46.7 53.3
1997 1146 635 264 371 41.6 58.4
1998 1360 750 335 415 44.7 55.3
1999 1433 795 337 458 42.4 57.6
2000 1336 740 316 424 42.7 57.3
2001 1318 730 360 370 49.3 50.7
Sources: PricewaterhouseCoopers/SHF-Icelandic Group of IFPI (Audit Surveys, 1995–2001) and IFPI (The Recording Industry in Numbers 1998 and 1999

Table 4. Value of Icelandic record sales 1991-2001. Million USD

Retail value Sale value at distributor level Percentage
Total Domestic Foreign Domestic Foreign
1991 15,9 ... ... ... 32 68
1992 11,6 ... ... ... … …
1993 8,3 ... ... ... … …
1994 12,6 6,8 2,9 3,9 42.4 57.6
1995 15,3 8,1 3,7 4,5 45.3 54.7
1996 16,5 9,1 4,3 4,9 46.7 53.3
1997 15,9 8,8 3,7 5,2 41.6 58.4
1998 19,6 10,8 4,8 6 44.7 55.3
1999 19,8 11 4,7 6,3 42.4 57.6
2000 15,8 8,8 3,7 5 42.7 57.3
2001 12,8 7,1 3,5 3,6 49.3 50.7
Sources: PricewaterhouseCoopers/SHF-Icelandic Group of IFPI (Audit Surveys, 1995–2001) and IFPI (The Recording Industry in Numbers 1998 and 1999)

At the same time as the value of sales at distributor level has increased by almost 85 percent, the increase in sale of sound recordings in copies is only 6 percent between 1991 and 2001 (table 5). Ath útsk_ringu á _essu Steinar

Table 5. Sale of sound recordings in copies 1991–2001. Copies in thousands

Total CDs Records and MCs
1991 700 500 200
1992 600 400 200
1993 600 500 100
1994 520 470 50
1995 600 570 30
1996 680 650 30
1997 740 725 15
1998 810 795 15
1999 910 895 15
2000 790 780 10
2001 740 730 10
Sources: Statistics Iceland (External Trade by HS-numbers), PricewaterhouseCoopers/SHF-Icelandic Group of IFPI (Audit Surveys, 1995–2001) and IFPI (The Recording Industry in Numbers 1998 and 1999).

Industry size

The Icelandic music industry is very small, but it is important when addressing the issue of the industry’s size, to keep in mind that the Icelandic population is just under 300 thousand people . In a report produced for the Ministry of Industry and Commerce in 1997 it was stated that industry employed 750-1,000 people. Their estimate was not based on thorough research, but on the opinion of a group of people who know the industry well,(ath hvort hægt er a_ or_a _etta betur.) and is therefore hard to ignore. More accurate information regarding the industry’s size is not obtainable at this time, due to complications regarding the adoption of the NACE codes at Statistics Iceland. To be able to provide information regarding the industry’s size, a small survey was made. Information was gathered from within the industry regarding the number and size of firms within it. The survey (tables 6 and 7) indicated that there are 3-4 publishers of sound recordings (NACE code 22140) in Iceland, employing a total of 20-25 people. The number of specialized stores for records and videotapes is approximately 5-6, employing 26-32 employees. Also nine stores for music, instruments & music scores (NACE 52454) were found. Figures regarding the number of people they employ are not available. The survey did not include supermarkets or book stores that sell sound recordings. Over the last few years, the variety of sound recordings within those larger stores is increasing, thus increasing their share of the market; information regarding how large this share is could not be obtained at this time.

Table 6. Number of employees in industrial sectors 2001- 2002

NACE code 2001 2002
22140 Publishers of sound recordings 21 25
52453 Stores for records & videotapes 26 32
TOTAL 47 57
Source: A survey within the industry.

Table 7. Number of enterprises in industrial sectors 2001-2002

NACE code 2001 2002
22140 Publishers of sound recordings 4 5
52453 Stores for records & videotapes 5 6
52454 Stores for music, instruments & music scores 9 9
36300 Industry for music instruments 1 1
TOTAL 19 21
Source: A survey within the industry

It is important to keep in mind that the figures regarding number of employees within the industry are not quite comparable since Edda and Skífan are divisions of larger enterprises. Edda has been Iceland’s largest book publishing company for many years. In the year 2001 the music department was founded. The department, which employs three people, is a small unit within the company that employs a total of 132 people. Skífan, the publishing unit, employs nine people. Skífan merged with Nor_urljós (Northern Lights), a large media enterprise in Iceland, in 1999. Both Skífan and the Edda music department enjoy the support of a larger unit in resources such as marketing, payroll offices, administration etc.

The small survey referred to above covered only a small part of the music industry. It did not, for example, include performers and creators of music. It is likely that the members of the unions and associations listed in table 8 are probably members of more than one association listed in the table but the majority of them can be expected to be in the Icelandic musician union In 1998 The Icelandic musician union had 465 members and 423 members in 1997. Of those members 161 were a pop music artists in 1998 and 147 in 1997.

Apart from the production companies, distributors, and artists, there are more companies and employees within the industry, such as promoters of music, concert halls, bars and other venues where music is performed. With that in mind, the suggestion made in the 1997 report, of 750 –1,000 employees, does not seem far-fetched. However it is evident that a more detailed study on the industry’s size is needed if the Icelandic music industry is to be comparable to other industries.

Table 8. Members of association of artists

1980 1985 1990 1995 1996 1997 1998
The Icelandic musician union (FÍH) 380 307 266 282 337 423 465
Society of Icelandic musicians (TÍT) 27 51 71 93 96 94 95
Society of Icelandic composers (TÍ) 24 28 37 41 41 41 42
Icelandic songwriters association (FTT) .. 60 49 58 63 65 110
Alls 431 446 423 474 477 623 712
Source: Statistics Iceland (1999)

Producers and distributors in the Icelandic music industry

Because the Icelandic music industry consists of a few small enterprises, it is possible to take a closer look at these companies and compare them (Tables 9-10). At the same time it poses problems, because they are reluctant to provide information, in case(laga or_alag) it might be useful for their competitors. Information regarding turnover is, for example, not available in most cases.

According to Table 9 Skífan is the largest single producer in Iceland releasing 43 titles, or 23 percent of total releases, in 1999, and 58 titles or 28 percent in 2000. It is also evident that there has been a significant increase in the category “others”; in 1999, 131 titles or 69 percent fall into that category, and 125 titles or 62 percent in 2000. This may be explained by new improved technology in recording, which enables more and more people to record a CD in a less expensive way than before.

Table 9. Release of sound recordings by producers 1990-2000

Released Total Japis Skífan Spor Smekkleysa Others titles
1990 83 – 13 19 4 47
1991 128 – 19 38 – 71
1992 140 1 25 57 1 56
1993 154 4 31 32 7 80
1994 177 9 25 43 12 88
1995 195 13 26 22 8 126
1996 217 8 10 34 8 157
1997 198 5 17 23 11 142
1998 196 7 22 28 12 127
1999 191 8 43 • 9 131
2000 203 6 58 • 14 125
Source: Statistics Iceland (1999)

Skífan is also the largest distributor of sound recordings, with 68 percent of total copies sold or 505 thousand copies at the value of $4.9 million . Edda enters the music market in the year 2001 with 50 thousand copies sold or 7 percent of sold copies (Table 10.).

Table 10. Sales of sound recordings by distributor 1995-2001. Sold copies in thousands

Total Edda Japis Skífan Spor Smekk- Tóna- Others
Year leysa fló_
1995 600 • 155 230 181 • • 34
1996 680 • 172 242 228 • • 38
1997 740 • 177 293 233 • • 37
1998 810 • 176 345 249 • • 40
1999 910 • 168 579 • • 119 44
2000 790 • 185 550 • • 15 40
2001 740 50 … 505 • 18 … 167
Source: PricewaterhouseCoopers/SHF-Icelandic Group of IFPI (Audit Surveys, 1995-2001)

When comparing the distributors sales value percentage to the distributes share of copies sold, Skífans strong position in the market is further supported with a 69% market share.
In tables 10 and 11 it is interesting to how Skífans market share changes from 68% to 87% when excluding the category others. That number is closer to the findings of the Icelandic IFPI surveys which do not include publications by individuals ore producers who are not members of the Icelandic IFPI group.

Table 11. Sale of sound recordings by distributors 1995–2001. Sale value at distributor level in million ISK

Total Edda Japis Skífan Spor Smekk-leysa Tóna-fló_ Others

1995 530 • 127 212 165 • • 26
1996 610 • 142 226 209 • • 33
1997 635 • 130 277 195 • • 33
1998 750 • 159 318 235 • • 38
1999 795 • 154 541 • • 60 100
2000 740 • 172 524 • • 8 44
2004 730 57 … 501 • 20 … 152
Source: PricewaterhouseCoopers/ SHF-Icelandic Group of IFPI (Audit Surveys, 1995–2001).
Notes: Sale value at distributor level Market shares based on estimated size of the total market

Skífan has the major market share of the largest sound recording labels, or 28 percent in the year 2001. Universal comes in second with half of Skífan’s share. Skífan also has the distributing rights for EMI-Virgin, Sony Music, Universal, BMG and Warner Music, which together with Skífan hold a 63% market share in 2001. The category “others” consists of small publishers, most of them likely to have published very few titles - often only one. When the category “others” is excluded there are, on one hand, Skífan and the labels for which Skífan has distribution rights, a total of 63% market share, and on the other hand the rest of the labels with a 10% market share. In 2001 these 10% are distributed between Edda (4.9%), Smekkleysa (2.5%) and BMG (2.5%). When excluding the category others as was done above the market share of Skífan and the labels Skífan has distributing rights for increases to 90% or 482 Million ISK of a total of 537 million ISK sales value at distribotor level.

Table 12. Market share of the largest sound recording labels 1995–2001. Market share in percentage of total sales

Producer label 1995 1996 1997 1998 1999 2000 2001
BMG 7 6 8 8 7 8 4
Edda • • • • • • 5
EMI – Virgin 10 9 13 8 8 10 8
Disky International • • • • 2 • •
Japis 2 3 1 2 1 1 •
MNV • • 2 1 • • •
Polygram 9 9 11 13 • • •
Skífan3 12 10 14 18 28 29 28
Smekkleysa (Bad taste) 4 2 3 1 2 2 3
Sony Music 6 8 9 11 10 8 9
Spor3 14 15 14 14 • • •
Tónafló_/Undraland • • • • 1 • •
Universal • • • • 14 15 14
Warner Music 6 5 6 5 4 5 6
Others 30 32 19 20 23 22 27
Total 100 100 100 100 100 100 100
Source: PricewaterhouseCoopers/ SHF-Icelandic Group of IFPI (Audit Surveys, 1995–2001).

Location of the music industry

It was mentioned earlier that information regarding the industry size was insufficient. However in table 13 information regarding the number of publishers and retailers categorized by region are presented. The numbers regarding Publishers (Nace 2214 and 2231) include some of those who only publish one or two titles as well as the bigger publishers and the numbers regarding retailing (NACE 5245 ) refer to retailers who carry electronics and instruments as well as sound recordings. Therefore table 13 does not reflect accurate information regarding publishers and retailers within the music industry. Never the less these figures are indicators of the regional division of actors who belong to the Icelandic music industry. Table 13 indicates that 80% of publishers and 3 out of 7 retailers are located in the capital region.

Table 13. Publishers and retailers of sound recordings 1995–2001. Number of enterprises

Total Capital region South-west West West-fjords North-west North-east East South
Publishers
1995 7 6 1 – – – – – –
1996 12 9 1 – – – 1 – 1
1997 18 14 2 – – 1 – – 1
1998 23 18 2 – 1 – – – 2
1999 22 17 1 – 1 1 1 – 1
2000 23 19 1 – – 1 2 – –
2001 25 20 1 – – 1 3 – –

Retailers
1995 6 4 1 – 1 – – – –
1996 7 5 1 – 1 – – – –
1997 5 3 1 – – – – 1 –
1998 7 5 1 – – – – 1 –
1999 6 4 1 – – – – 1 –
2000 7 3 1 1 – 1 – 1 –
2001 7 3 1 1 – 1 – 1 –
Sources: Statistics Iceland (Register of Enterprises 1995–1996, unpublished) and the Internal Tax Revenue (Value Added Tax Returns 1997–2001, unpublished)

Iceland inhabits 285 thousand people. About 175 thousands of the people live in the capital area whichexplains why the majority of actors in the music industry are located in the Reykjavík area. In table 14. overview of concerts that took place in Iceland in 1995 and 1999 is presented. Only 8,8 percent in 1995 and 6,9 percent in 1999 of the concerts listed are pop concerts. The majority of concerts in these years were classical. In 1995, 66,1 percent and in 1999 64,8 percent. It is possible that a great deal of pop concerts never reach these files because they are underground and therefore the nations capital the share of pop music is higher than these figures indicate. Never the less it is interesting to look closer at the figures for pop concerts.

In 1995 roughly 69% of pop concerts took place in the capital region, and 57% in 1999. In 1995 11.5% of pop concerts took place in the North, and 12.1% in 1999. Other places enjoy less than 7% of the pop concerts held in the country, with the exception of the East, which has increased its share of pop concerts from 6.6% in 1995 to 11.2% in 1999. Reykjavik is the only music cluster in Iceland. The components of the music industry in Iceland are almost all located in the country’s only city: Reykjavík. All the record companies are located there, all locales for major concerts are located there, stores that specialize in sound recordings are located in Reykjavik, and finally most pop music performers are located there. The strength of Reykjavík as the centre of all musical activity in Iceland is obvious, and it seems that it could be demonstrated even further by examining the origin of the main actors in the industry; many of them come from small places around the country and come to Reykjavik to be able to participate in the musical arena.

Airplay performances

The royalty-collecting societies in Iceland could not provide any accurate information regarding the share of domestic music in airplay performances. In order to give an idea of the division between foreign and domestic airplay, six radio stations were contacted and asked to estimate the share of Icelandic music on their station.

Table 7. The share of Icelandic music in radio stations

Radio station Share of Icelandic music
Channel 1 35%
Channel 2 35%
Bylgjan 20%
Fm 95,7 15%
Létt 96,7 10%
Radio X 10%
Children’s channel 100%
Source: A survey within the music industry.

The Icelandic National Broadcasting Service has the highest share; both channels state that 35% of all music broadcast is Icelandic. The other stations, owned by Nor_urljós, present a lower share of Icelandic music, with the exception of the children’s channel.

Conclusion

The music industry is a growing industry. The value of domestic record sales at retail level has increased by almost 50 percent between 1991 and 2001. The growth has been more in domestic music than foreign, leading to the fact that the market is split equally between foreign and domestic releases. The market is divided between one large record company and 3-4 small ones. Skífan has distributing rights for EMI-VIRGIN, Sony Music, Universal and Warner Music, which together with Skífan hold a 63% market share in the year 2001. Approximately 27% of the total market fell under the category “others,” which leaves the remaining record labels with a 10% market share.

This is the first attempt to map the music industry in Iceland. Therefore few data were available, and statistics and other information were often hard to find. There are no export figures available regarding the music industry, information regarding the size of the industry is lacking, and accurate statistics regarding airplay performances are also not available.
It seems that lack of competence in accessing capital or other support, as well as lack of supportive institutions, explains why actors within the industry have not reached a higher level of professionalism. Over the last few years institutions such as the New Business Venture Fund and the Trade Council of Iceland have involved themselves in music industry affairs by consulting them in matters of export, raising capital and marketing their products. It is likely that, paralleled to increased support from institutions as well as venture capitalists, the music industry will become more professional. Hopefully that will entail more accessible information, and put pressure on government systematically to gather statistical and other forms of information regarding the industry.
The industry stands at a crossroads. It will be interesting to see whether the Ministries of Industry and Commerce will take action as they have declared themselves willing to do, in order to improve the performance of the music industry.

Sources

IFPI, International Federation of Phonographic Industries (1998). The Recording Industry in Numbers.

IFPI, International Federation of Phonographic Industries ( (1999). The Recording Industry in Numbers.

Ministries of Industry and Commerce (1997). Íslenskur tónlistari_na_ur, aukin sóknarfæri.

Ministry of Education, Science and Culture (2002). Menning.

PricewaterhouseCoopers/SHF-Icelandic Group of IFPI . Audit Surveys, 1995–2001

Statistics Iceland (1999). Fjölmi_lun og menning.

Websites:

http://idnadarraduneyti.is
http://www.ihm.is
http://www.hagstofa.is
http://www.icetrade.is
http://www.nsa.is
http://www.si.is
http://www.sfh.is
http://www.stef.is

Source:
http://www.step.no/music/Iceland%20downloadable/Mapping%20vinnuskjal.doc