1. www.musexfinland.fi FINNISH MUSIC EXPORTS: BEHIND THE SUCCESS UU Cultural Development & NICEC Study Visit to Finland Paulina Ahokas / Music Export Finland, June 21, 2006 I.What is Music Export Finland II.Development of Market Value of Music Exports 1999-2004 III.Music Industry Income Streams IV.Key Factors Behind the Success V.How to Sustain the Growth VI.How Music Export Finland Operates + some music for your ears…

2. www.musexfinland.fi I.WHAT IS MUSIC EXPORT FINLAND An export association representing the entire Finnish music industry –Members all the key trade associations: Composers´ Copyright Association Teosto Neighbouring Rights Association Gramex Light Composers’ Association Elvis Music Publishers´Association IFPI Finland Independent Producers´ Association IndieCo Musicians’ Union Initiates and facilitates the marketing, promotion and sales of Finnish popular music abroad –Works with professional companies only

3. www.musexfinland.fi II. DEVELOPMENT OF MARKET VALUE OF MUSIC EXPORTS 1999 - 2004 1 883 490 € 3 800 842 € 3 345 012 € 9 410 180 € 9 428 276 € 5 997 567 € 6 267 120 € 21 692 963 € 1 917 352 € 6 065 168 € 3 507 789 € 7 178 686 € 15 417 315 € 4 730 840 € 17 857 746 € 6 739 242 € 5 194 361 € 5 924 143 € 5 353 378 € 9 486 769 € 5 199 663 € 20 039 811 € 0 € 5 000 000 € 10 000 000 € 15 000 000 € 20 000 000 € 25 000 000 € ProductsServices Royalties Aggregate Value € 1999€ 2000€ 2001€ 2002€ 2003€ 2004 Average Annual Growth ca. 26 %

4. www.musexfinland.fi III. MUSIC INDUSTRY INCOME STREAMS - Exporters / Music Industry Professionals Teosto ry/NCB Blank Media Levy Gramex ry AV Producers Instrument Manufacturers Ring Tones Digital Formats R R TO LV TO -Mechanical Royalties -Public Performance -Import -Wholesale -Retail -Mail Orders -Ring Tone Retail - Live Promoters -Festivals Customers Tax, TV License Channel Fees Entrance Fees Records Synchronization Instruments Sheet Music Ring Tones Tickets Grants, RoyaltiesGovernment and Public Organisations -Composers -Lyricists -Arrangers -Translators -Musicians -Soloists -Conductors Grants, RoyaltiesPrivate Organisations: LUSES, ESEK etc. FOREIGN COUNTRIES ( Modified from source: Teosto ry 75 years”Anna mulle tähtitaivas” ) Record Companies Agencies Publishers Managements TO (R=Royalties, TO=Turnover)

5. www.musexfinland.fi IV. KEY FACTORS BEHIND THE SUCCESS Internationalization of Finnish culture –Geopolitical changes: collapse of trade with the Soviet Union, joining the EU and implementation of Euro –Education: language skills, dynamic educational strategies –Economical changes and increased travelling (Interrail!) Investment to the basis of the value chain –Musical education = Product development Basic structures in place –Copyright legislation and administration –Taxation –Healthier business environments for companies Versatility and originality of Finnish culture (= content) –Isolation and slow pace producing possibility for development Maturity of music business professionals –Pioneers –Generation change within companies –International awareness  Results in predominantly domestic (58%) repertoire!

6. www.musexfinland.fi Key factors behind the success (cont’d) Competetive/low production costs The facilitation of communication structures through technological innovations –Relatively easy to implement new technological structures and innovations –Finns eager to learn and to apply new innovations IV. KEY FACTORS BEHIND THE SUCCESS

7. www.musexfinland.fi Key factors behind the success (cont’d) Breakthrough artists (i.e. Bomfunk MC’s, Darude, HIM, The Rasmus,, Nightwish) lead to increased interest in the international music market to Finnish artists and their representatives And at the same time, hunger and ambition within Finnish artists and their representatives grows IV. KEY FACTORS BEHIND THE SUCCESS

8. www.musexfinland.fi V. HOW TO SUSTAIN THE GROWTH More focus on marketing, communications and access –How do people consume music in the future – and now More know-how within music companies The introduction and implementation of courageuos new business models in the Finnish market and within Finnish music companies The need to be in the avant garde of music & technology, and specifically, mobile music

9. www.musexfinland.fi VI. HOW MUSIC EXPORT FINLAND OPERATES i.Internal Marketing Finnish Music Companies - activation, consultation, development of operational frameworks Development of exporting support systems - commissioning of market research

10. www.musexfinland.fi ii.External Marketing Market Research - product specific - contact database Personal Selling - In co-operation with the companies Promotion - Business-to-business publications - Music Channels Advertising and Direct Marketing - Internet, E-mail VI. HOW MUSIC EXPORT FINLAND OPERATES

11. www.musexfinland.fi iii.External Marketing (cont’d) Sales Materials and Co-promotion - Sales promotion tools (Electronic and physical) - Production and distribution of CD-compilations Co-marketing and Showcase Production - Professional Trade Events e.g. Eurosonic, Midem, Canadian Music Week, South By Southwest (SXSW), MusExpo, Sonar, In The City (ITC), Popkomm, MusicWorks, Access All Areas etc. - Showcases and Tours e.g. Finnish Music Day in Tokio, primary European Destinations (London, Berlin, Paris) etc. - Co-organized tour entities Networking Events in Finland and Abroad VI. HOW MUSIC EXPORT FINLAND OPERATES

12. www.musexfinland.fi And some music… Apocalyptica The Rasmus The Crash Nightwish HIM