Dial Up a Local Tune With MTN in South Africa

MTN is aiming to boost the local music scene by helping musicians prepare professional recordings for downloading to a cellphone. Unsigned artists will be given studio facilities to capture their songs and the results will be listed on MTN's website. Cellphone users will pay a small fee for each tune they download, giving the artists a source of income as well as potential fame and glory.

MTN says the new Xploaded venture is largely altruistic, as it will not make much money from the musical downloads. But it hopes to recoup its investment by winning more subscribers hooked by music on the move.

The operator has already become SA's largest digital distributor of local music through its website, MTNLoaded, says its senior manager for websites, Lana Strydom. "It's not a major money-spinner but the long-term benefit is to connect to our customers. "

Xploaded will use digital distribution to help emerging artists break into the market and will give music lovers access to as yet unknown content. Users will be able to listen to a sample before buying, and once they have downloaded a song to their cellphone they will be able to download it to a computer too, if the artist gives permission for that to happen. The scheme is not only aimed at hip and happening youngsters, as jazz and classical music will also be made available.

MTN's partners in the project are Endemol, which produces content for TV and mobile viewing, and Matchboxology, a campaign management company. "Consumers have migrated back to instant gratification, so single downloads have become core to the digital music industry," says Sivin Pillay, head of commercial business for Endemol SA."All artists will have the opportunity to be part of Xploaded. All they have to do is contact us. Consumers will decide how popular and how fast they rise."

A related project will see aspiring managers offered free training to help create a cadre of music managers. Candidates will be screened to ensure they have the potential to make a career out of it, says Strydom. "A lot of talented artists don't get the opportunity to grow because of a shortage of managers. The artists are not commercially savvy and don't understand the opportunities or how to sign commercial deals."

So far, data traffic accounts for 10% of MTN's revenue in SA and earned R2,8bn last year, up 42% from the previous year. Fees for Xploaded downloads have not been set yet, but may vary according to the popularity of the artist, growing more expensive as a band gains fame.

Gallo Music marketing manager Tsholo Moraba says only 2% of music being bought in SA is sold digitally, with 98% still being sold in a physical format. But the high cellphone penetration rate coupled with the phasing out of old handsets in favour of music-enabled phones should trigger a major rise in digital downloads within a couple of years.

Gallo does not see Xploaded as a threat to its own sales, Moraba says. "It's a positive move by MTN to unleash more content into the country."

Business Day

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