That time JAPAN music sales died

With the recent introduction of major streaming services in Japan, the country's music industry has begun to move away from physical sales.

Japan has been the last bastion of physical CD sales. 85% of music sales come from physical sales, and digital sales have actually been on the decline. Physical sales are higher in Japan than in other countries. Japan has been the only country where physical sales remain a good indicator of an artist's popularity. While overall sales have been on the decline, the rate of decline has been much lower than the rest of the world.

Japan's ability to remain strong in physical music sales has largely been due to a lack of streaming services in the country. The decline in music sales in other countries can be attributed to the ease of access and low-cost of streaming services. Japan music market hasn't experienced this shift until very recently.

In the span of about a month, 3 major streaming music services have launched in Japan. AWA, a streaming service from Japan's largest music label Avex, launched at the end of May. A couple of weeks later, Line launched Line Music. On July 1, Apple Music began streaming in Japan.

Music rights in Japan are notoriously difficult to get, making it a difficult market to enter and work within. This has kept streaming services at bay even while the rest of the world embraced it as the future of the music industry. However, with the market effectively untapped, companies have begun to makes moves to monopolize the market before other potential competitors.

Spotify, a leader in the music streaming industry, is looking towards Japan as its next big market. On June 15, the company received an investment from Dentsu Digital Holdings to help bring the service to the country. The company is expected to begin streaming in Japan later this year.

According to a survey conducted by Oricon Style, the public's view on streaming coming to Japan is about 50-50. 46% viewed streaming positively, while 54% viewed it negatively. While the convenience and cost of streaming was viewed positively, many people expressed a desired to physically own a CD and were concerned about data restrictions from mobile phone companies.

Japan's physical music sales fared well when digital purchasing became the norm across much of the world. However, with the numerous consumer benefits streaming services offer, the days of physical CD sales may see a sharp decline, bringing the country in line with the rest of the world's music consumption pattern. The 2nd half of 2015 will be a significant indicator as to whether Japan's music industry will see a substantial shift in the way consumer get music.