Our choice of online music stores is quite limited in South Africa.
Though we might not have access to Apple’s popular iTunes music store, there are a few ways to buy music online with a South African credit card and currency.
Some of these market places are Nokia Music (previously Ovi Music), Rhythm Music Store, and DStv’s Omusic. These digital music stores might not have what you’re looking for, however, especially when it comes to recently released tracks or albums, or if you have a taste for more niche music.
With music stores such as iTunes not available locally, it has raised the question of whether there aren’t obstacles in South Africa preventing such retailers from operating here.
iTunes also isn’t the only international music store not available in South Africa and Samsung recently got hauled over the coals at the Advertising Standards Authority of South Africa (ASA) for advertising their “Music Hub” store without it actually being available locally.
Paulo Ferreira, head of mobile product and business solutions at Samsung South Africa, answered our questions regarding Music Hub and the challenges they face with selling digital music in SA.
What might be holding back Music Hub in South Africa?
The launch of Music Hub has been impacted by several areas. Firstly, we are facing licensing and distribution issues for the African continent and South Africa. Secondly, Samsung South Africa is still exploring a local solution with known South African music partners. Lastly, we are investigating local payment partners to facilitate a paid store.
What is involved in getting the rights to sell music (or other content) in South Africa?
This varies according to local laws and regulations. In a nutshell, the typical process will include gaining a distribution license from the official content provider. This applies to music, games or any form of digital content.
Most content providers will want to see a sound business plan that includes a distribution agreement, retail and marketing plan. Local businesses will also need to comply with the WASPA regulations to ensure that their business is operated in an ethical, transparent manner.
Are there any particular hurdles in South Africa you would like to see removed? Who would need to remove them?
Samsung South Africa continues its commitment to local partners and we endeavour to cooperate with them wherever we can.
We see hurdles in terms of the prevailing music piracy online. Traditional mobile payment mechanisms are also limited in terms of reach for South Africa.
South Africa continues to be a music-loving nation, however there are too many who download their music illegally. In fact, according to the IFPI it is estimated that more than 95% of music is illegally downloaded globally.
We encourage individuals to download their music responsibly and only via legitimate online music stores. That will go very far in alleviating the issues of mobile and online music retail in South Africa.
Could you please elaborate on the issue of the reach of traditional mobile payment mechanisms? Which payment systems are you referring to and can’t they be replaced by local operators such as PayFast, PoCIT?
The issue of reach has perennially been compounded by fragmentation. There are simply a plethora of choices, consumers are often not aware or in some cases educated about which payment solution is best to use.
In a recently released KPMG study, less than half of the respondents believe that mobile payment will go mainstream — of which 81% rank convenience and accessibility as a critical success factor. I believe that this problem will be reduced in the next 2 to 4 years, with the increased uptake of smartphones locally See: Mobile payment services expected to be mainstream in 4 years.
For now, I believe that operator billing continues to work, although it dramatically affects the margins for the content providers.
Regarding piracy: As you described it, it sounds like a bit of a chicken-and-egg situation. There is a lack of legitimate online music stores in SA, yet online music piracy is holding back a more vibrant mobile and online music retail sector. Would you say this is an accurate description?
Correct, it is somewhat a cyclical discussion.
The best way to combat this is to encourage consumers to purchase music legally, on or offline. It needs to start with the individual consumer, however this will not happen overnight.
In addition, DRM (digital rights management) issues also impact the volume of music downloads. Music streaming services might be an option in the near future, however it will be dependent on the realisation of higher bandwidth speeds at lower prices.