Max Hole: China Matters

During his keynote speech at Music Matters in Singapore last month, Universal Music Group CEO and chairman Max Hole said attendees should pay special attention to China.

Asia, he pointed out, has 60 percent of the world’s population but accounts for less than a quarter of global music sales, and most of those sales are in Japan.

“When I look at the Chinese music industry, despite its difficult past, I see the future,” he said. “China is not only the world’s largest country, it is also the world’s biggest experiment in testing the new business models of the future.”

Hole elaborated by saying that China “bypassed” the dominant musical business model that the West and Japan depended on over the past 50 years, the purchase of product either physical or digital. The whole point of music in the future will be “securing access to tracks,” namely streaming, which is where China is at now.

“As an industry, China is our billion-people challenge,” he said. “If we touch all of these consumers, just once a year, in some form, then we will generate more yuan to reinvest in China and build our businesses.”

Success will depend on developing local talent, which requires a whole new approach.

“We have to remember that if we deliver good Chinese music in an environment where it can be bought easily, cheaply and legally, then we will all prosper.”

He pointed out that for too long Western music companies have money in Asia “with artists from outside the region,” and conjectured that China, Indonesia and India will be the “key markets” for prosperity in Asia.

However, he also said that Japan should not be overlooked.

A healthy Japan means a healthy global record business. It is imperative that we all work together – record companies, artist management companies and music platforms – to revitalize the business.”