Singing the blues

The Arab pop industry may exhibit some of the shark-like traits of the music industry in the West, but it has so far failed to produce more than a few truly international stars. With major labels now snapping up local talent, the situation may soon change. But even that change is likely to affect just a handful of the very biggest names.

The Arab music business suffered a setback when Sony Music Egypt and Sony Music Lebanon recently ceased operations, reportedly due to the downturn in the global music industry. In nine months of operation, Sony Music Egypt released 120 albums. Sony Music Lebanon had signed two local artists this year, Reeda and Ouimena, and Sony Music Egypt signed a boy band. Jonathon Morrish, Sony's vice president of communications for Europe, said the three artists were affected.

"It's impossible to divorce the reasons behind these local decisions from the severity of the global downturn in music sales," says Morrish, "though the market conditions in both Egypt and Lebanon have been very difficult." The Lebanese industry is in decline and the Egyptian industry, according to the most recent International Federation of the Phonographic Industry figures, shows a decline of over 40 percent in units sold.

In good times and bad, Egypt is the traditional heartland of Arab pop, boasting the majority of its songwriters and musicians - and the region's largest population. "Most artists like to come to Egypt for production because most of the composers are here, and it is easy to find musicians," says Rania Madkhour of Dice Marketing & PR Events. Dice is a concert promoter and represents Lebanese star Nawal Zoghby in Egypt.

Persistent censorship in Egypt and the resurgence of the more liberal Lebanese cultural scene has loosened Egypt's grip on the Arab music industry. In recent years, Lebanon has produced more than its share of pop stars with region-wide appeal. "We are losing the lead fast, but have not lost it yet," says Magued Makram, co-founder of event organizers Modern Touch. Prominent DJ Madkhour adds, "Egypt used to be the main source of pop stars. Now they are coming from Lebanon and the Gulf."

Makram identifies censorship and conservative values as the primary reasons for Egypt's lost ground. "There are too many old people dominating the business," he says. "The old stars are great and they really take your breath away, but it is not their time now," he says. When they first started out, the older stars were subject to the same criticism as today's stars, he adds. "I am not for bad lyrics, or pushing someone like Sha'aban Abdel-Rahim [a controversial Egyptian singer] to be a superstar, but when there is a chance to do different music, let the public judge."

The two biggest Arab stars are Amr Diab and Nawal Zoghby, both of whom have pan-Arab appeal. However, the general picture is of a divided region. Makram says there are music boundaries within the Arab world. Gulf singers perform mainly in Gulf states, and Lebanese and Egyptian singers dominate in their own neck of the woods.

"The Egyptian dialect is the most universally understood dialect throughout the Middle East," says Ahmad Marei, the former managing director of Sony Music Europe. "Now singers are trying to have different dialects on each album. This way there is a greater chance of more songs on the CD being popular," says Madkhour. Nawal's new album contains Lebanese, Egyptian and Algerian dialects.

While aiming for pan-Arab appeal, Arab stars are also looking to move into the international pop scene. "They are now working hard to break the language barrier. They are trying to use foreign rhythms and doing tours with foreigners," says Madkhour. There are some Algerian pop stars who have enjoyed international success, particularly in France. These include raï artists such as Cheb Mami and Khaled.

The music video has enabled Arab stars to reach across the region, through state-owned and satellite channels such as Dream and Nile Variety. "The music video has become critical in the Middle East, probably even more important than abroad. When launching a single or album, video is really the only way to hear about it," says Marei.

With the exception of Lebanon and Dubai, radio is underdeveloped in the region, so the local music industry cannot really make use of this promotional tool.

Although pop videos are crucial, there is a dearth of video production services, and producers charge accordingly. "The latest quotation is $30,000 per day, with 450,000 Egyptian pounds ($97,000) just for the director," Marei says. Sometimes two or three clips are needed to break an album - the cost is far too high, particularly when albums only sell about 70,000 cassettes.

Concerts make up for the underdevelopment of radio, and the low penetration of CD players and satellite. "Many Egyptians do not have access to music, so the concert circuit in local areas is critical," Marei says. The proof is in the figures. "In the record business there is a correlation between live performances and record sales the next morning," he adds. One of Nawal's Pepsi concerts drew a crowd of 45,000. Pepsi paid for the whole production - concertgoers exchanged caps from Pepsi products for tickets.

Concerts are also an important revenue stream for stars. "Most revenues come from concerts as piracy cuts the money coming from record sales," says Madkhour. Performances at weddings and other private social events also help to offset piracy losses.
The relationship between artist and manager is another distinguishing characteristic of the Arab music scene.

"Unlike in Europe or the United States, the manager in the Arab world is more of an assistant and lacks power," says Makram. The marketing machine behind the world's biggest pop stars is missing. "There is no star-making team; professional marketing, management, lyrics, choreography and styling are missing."

Also, companies don't hold onto stars long enough to set long-term development strategies. "In the past five years, the top 15 artists throughout the Middle East have been recycled from company to company," says Marei. "The flat fee in 90 percent of the cases is on a per-album basis; the artist has no sense of belonging."

The signing of Arab stars by major foreign labels may well change that. "I admired Sony Egypt's efforts in looking for local artists. This is the healthy way to do business," says Makram. "Don't just impose international stars on the Arab world, but try to mingle with the local culture. This way we can really start jamming."

For it to work there is a case for moving from flat-fee single-album contracts for the highest bidder to a royalty system. "Currently local companies sign artists for a flat-fee per album. The artist produces the album independently and then tries to sell the master album to the highest bidder. Beyond that master sale, the artist does not care," says Marei. "Artists are signed at ridiculously high fees. Every deal should make financial sense on its own merit."

Marei says a $1.5 million signing fee for an Arab artist can't be justified when they are only selling cassettes, but are unwilling to accept a lower fee and royalties.

Marei says he saw a change in the attitude of artists to royalties during his time at Sony Music Egypt."At first people thought we were joking," he says. Sony Music Egypt was talking to a few artists who fully accepted the royalty system, during the summer. Marei is now hoping to set up a record label that operates on a royalty - and not a flat-fee - basis.

India and Russia have already ventured down the path of royalties. But there are barriers. "The problem here is that there is a serious element of mistrust between artists and local record companies," says Marei. Artists could make more money on the royalty system, but they do not want the risk of getting nothing if the album flops.

Sony worked with its artists on a royalty basis. Artists were contracted for a certain number of albums, and then a number of options after that. The royalty system ensured artist support in promotional activities.

Enthusiastic artist support is essential to successfully hitting the many markets potentially interested in Arab pop music. "France aside - because Arab music there has crossed over into the mainstream - in many other markets - the United States, Britain, Germany, Latin America and Australia - there is a lot of work to do," says Marei.

Meanwhile, the cause of international Arab music has advanced through artists like Shakira, the Colombian singer whose Arab roots are reflected in her Arab-style dancing. "Before 9/11," says Marei, "an article in Billboard predicted Arab music could be the next big explosion."