Presentation from the REGION - CENTRAL EASTERN EUROPEAN MUSIC CONFERENCE - RegiON BarCamp ‘09 Date:2-4 OCTOBER 2009 Conference Venue: PALACE OF ARTS (MÜPA), BUDAPEST Presenter: András Bodrogi - Program Coordinator of Music Export Hungary. THE MAIN TOPICS OF THE REGION BARCAMP WERE: * Market overviews – what are the challenges/improvements in East and West * Music and the mobile/internet sector * Talent development – Roots & Routes a well established current international model * The music sector from the musicians and producers point of view * Live networking between the Region’s Clubs, Booking Agencies and Festivals GUESTS INVITED TO THE CONFERENCE Music professionals from the surrounding countries, representatives of the Hungarian and international live music scene –directors of music organisations, representatives of significant music agencies, music managers, maintainers, programme coordinators of major cultural institutions and concert halls. This presentation is about the Hungarain music market in 2009. About the previous projects of Music Export Hungary, in addition, the new developments and future projects of MXH.

1. [email_address] on Conference 2009 PANKKK-Music Export Hungary, New developments and future projects András Berta – András Bodrogi Program Director Program Coordinator

3. Market Overview – Hungary (2009) Average CD Prices Local CD Album Format 2500 – 3500 HUF / 10 – 12 EUR Intl. CD Album Format 4000 - 5000 HUF / 15 – 19 EUR GOLD Super Budget CD(local&Intl.) 900 – 1200 HUF / 3 – 5 EUR EE Version of an Intl. CD album (majors) 3200 – 3500 HUF / 11 - 12 EUR

4. Average Gross Salary for a Full Time Job (source KSH, 2009.) 198.200 HUF / 733.3 EUR

5. According to the latest published market analysis (2006) of the MAHASZ Total recorded music selling in 2005 5,85 million units / 6,67 billion HUF 24.615 192 EUR Compared to the numbers of 2004, this meant 23.3 % decrease in overall sold units and 15 % decrease in the value of return. T otal recorded music sell ing i n 2008, 3, 5 million units - 4.4 billion HUF. 16.223 762 EUR This means around 40 % decrease in total number of sold units compared to the results of 2005.

6. Market Overview – Hungary (2009) Piracy 2004 . MAHASZ and the local collecting societies established the „PRO-Art Union for Copyrights“ that is facing the challenge to reduce piracy with the advent of digital music. 1990 . - 90 % 2005 . - 15-20 %

7. Market Overview – Hungary (2009) DIGITAL MUSIC MARKET The digital distribution of music locally started in 2005. L aunc h of the T- Online Music Store - Stopped its digital distribution as Track.hu in 2009 mainly because it was not profitable Currently there are two legal online music stores: S ongo (www.songo.hu) and Dalok.hu ( www.songs.hu ) iTunes is not operating in Hungary and it never will according to Steve Jobs : “ There are certain Eastern European countries (APPLE) will never operate in, simply because the potential profits are not worth the initial time and expense of negotiating the rights.” ( Source: Hogan & Hartson LLP 2009 Copyrighted. Steve Jobs, CEO, APPLE, 27 May 2009 )

8. Hungarian digital music consumers have to pay 124 - 340 HUF - 50 EUR cent- 1,3 EUR for a track to download depends on the online music store that they visit for such purchase.

9. I n 2005 , 1 % - 253.794 units of downloads, online and mobile - of the overall return of recorded music sales were sold digitally, online and mobile. 70.874 595 HUF / 262 147 EUR In 2008 , the number of total downloaded and streamed digital music content was 41.593 837 units that generated 195.658 440 HUF 721 935 EUR Digital Downloads: 117 847 units Online Streaming: 41.131 777 units Mobile Downloads: 341 443 units Mobile Streaming: 2770 units Mobile Subscription: 178 504 HUF Other Digital Contents: 3.060 554 HUF (Source: MAHASZ)

10. PANKKK - Program for the National Culture of Popular Music The general concept was proposed by music industry professionals and organizations in order to fulfill a cultural mission , to build the industry , to develop local economy . www.pankkk.hu As a part of th is development program the Hungarian Ministry of Culture decided to set up the Music Export Hungary office with the aim of promoting the values of the Hungarian popular music scene on an international level. www.mxh.hu

11. MXH / 2005-2008 MXH started to functioning on 1st of September in 2005 within the structure of Hungarofest Kht ., association in charge of organizing cultural seasons and other image building events abroad. MXH always had a full professional independence and its activities mainly related to the following areas :

13. PANKKK – MXH 2009/2010 At the beginning of 2009, as a part of the structural changes within the whole program, MXH joined the newly founded PANKKK Program Bureau , thus enabling more efficient ways of synergy between the domestic subsidies and the export projects . With the new system PANKKK is capable of assisting the whole life span of a band from talent contests till the possibility of an international career . From September 2009 the PANKKK-MXH export projects will be carried out with new instruments , fulfilling a streamlined mission .

14. PANKKK – MXH 2009/2010 The different sections of this new working method are: - PANKKK export subsidies - The setup and coordination of an Export Board , taking decisions of the MXH export roster - The creation and continuous update of an „ exportable bands database ” - The creation and continuous update of the „ export partners database ”

15. PANKKK – MXH 2009/2010 - The development of mxh.hu as a public database and news source of Hungarian music - The development of the MXH online social media presence - Continuous spreading of Hungarian music-related news via online media - The coordination of Hungarian presence at music industry trade events

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17. ENJOY YOUR TIME IN BUDAPEST! ENJOY THE MUSIC OF THE EASTERN EUROPEAN REGI ON !