Why small markets have weak domestic repertoire: A hypothesis
Why do international hits dominate the charts of local markets in so many places that we go to? Why can’t the local domestic market seem to make a dent on their own local industry? Eilish Gilligan of The Guardian Australia asks this question. This question hits home for a lot of us working in the local Singapore industry as well.
Other than the obvious answer staring in your face that small markets simply lack the critical mass to create a star, my theory stems from a separate question: Are our domestic labels cost centers or profit centers?
The business of recorded music revolves around a handful of major companies that are optimized for value extraction from markets outside of their Anglo-American centers (i.e. MENA/APAC markets for English-speaking segments).
There can only be a small number of mega hits and mega stars that disproportionately earn all the money at any point in time. There are only a few A&R hubs where talent is concentrated. The same way BMW’s R&D / high-end engineering all happens Munich, but I digress.
To grossly oversimplify, in places where international repertoire has historically dominated the market (e.g. AU, NZ, SG, MY), the tendency is for companies and jobs to be created for the purpose of extracting value from local markets and funnel it back to profit centers in US/UK. The surplus value (profit) is not always re-invested locally. Feedback loop continues. Effectively, for us sitting here in Singapore or some other market on the periphery, we are a cost center.
I mean, if the jobs are created by businesses whose priority is to extract maximum surplus value (profit) in the short-run, then business activities will prioritize marketing international repertoire over the creation long-term value in the form of a strong domestic repertoire. The problem is not with the players, it is with the rules of the game.
In many music scenes, the criticism directed towards local Major labels (or their imprints) is that there is a very low likelihood that they can make a local signing become internationally successful. With this preliminary understanding of how the industry works, it becomes quite obvious why this is the case. Just count the number of A&R people versus the sales, marketing, or business development team supporting international repertoire.
Building on Gilligan’s article, domestic charts of small markets will always be dominated by international artists because nobody has the resources nor expertise to flood the market en-masse like the major labels do.
