Afrobeats, a genre deeply rooted in Nigerian culture and inspired by decades of African rhythm, has now become a global sensation.
Artists like Wizkid, Davido, Burna Boy and Rema (pictured) have captured the attention of the world, headlining international festivals, amassing millions of streams and solidifying Afrobeats as a staple in the global music industry. Wizkid’s video for his song Piece of My Heart (ft. Brent Faiyaz) has amassed 5.2 million views in just three weeks since it was released.
Streaming, album sales, touring, merchandise, licensing and partnerships with brands all offer huge economic opportunities for successful Afrobeats artists. Global streaming services like Spotify and Apple Music have been crucial in the heavy promotion and widespread distribution of Afrobeats while major labels like Universal and Sony have divisions solely dedicated to African music. North American megastars Drake, Justin Bieber and Beyoncé have all collaborated with Nigerian artists, bringing the genre to massive new global audiences.
Yet despite the financial success and cultural influence of Afrobeats abroad, the mood in the Nigerian music industry is less upbeat than it might be. In 2023, Afrobeats generated an estimated $100m, but only a fraction of that income is thought to have found its way back to Nigeria, according to Mag Rodriguez, founder of Even, a platform enabling artists to sell their music directly to fans.
This disparity poses a difficult question: who really is benefiting from the success of Afrobeats, and what more can the Nigerian industry do to capture that value at home?
The economic potential of Afrobeats
Michael Odiong, CEO of Nigeria’s Premier Records Ltd, says that without well-structured policies in place, financial benefits will continue to elude the home of Afrobeats.
The local music infrastructure in Nigeria, though in many ways impressively adaptive and creative, is lagging behind in international standards, he argues.
“The biggest challenge that music studios and concert promoters face is the cost of setting up a standard studio, the proliferation of equipment and the lack of proper venue structure for shows,” Odiong says.
Fully equipped music studio that pass global standards are prohibitively expensive for local artists, forcing them to work in less technically adept makeshift home studios and impacting the final product.
Meanwhile, the gatekeepers of the international music industry – typically US or European media giants established over decades – are much better able to offer the advanced equipment that top-tier artists require to record their work.
As a result, ambitious Nigerian artists typically aim to sign contracts with international labels, rather than local labels whose technical abilities and distribution reach falls short of global competitors.
Afrobeats superstars are well represented on global labels – in 2017, WizKid signed a multi-album deal with US labels RCA Records/Sony Music International, while Burna Boy is signed to Atlantic. Both also have their own Nigerian imprints.
Nigeria also lags in the live arena – one of the most significant revenue areas for artists since the global decline of physical music formats. Simply put, Nigeria lacks concert venues for performances on a larger scale. Top-tier artists like Burna Boy and Wizkid, who often perform to crowds of hundreds of thousands abroad, struggle to find domestic venues to accommodate the size of audiences they attract.
This gap in infrastructure limits local promoters in their ability to stage high profile events, and pushes artists to rely even more on foreign shows as a major revenue driver. Stars are also much more incentivised to earn money in strong foreign currency rather than the in the weak naira at home. Promoters complain that they face considerable risks financially due to high costs of production and security compared to international peers.
Tobi Adebayo, entertainment and business analyst at Sterling Bank, points out that with the genre’s rapid expansion, there is a demand for specialised roles in artist management, event production and tech development. Entrepreneurs in Nigeria have also recognized the value innovation has in the Afrobeats ecosystem, with the rise of streaming and digital distribution platforms.
Yet like other sectors, music requires a positive government enabling environment to reach its full potential.
“As long as we do not have a structured policy system to safeguard our industry, we will continue to face these issues,” sayd Premier Records’ Odiong.
Without legislative support, he argues, local record labels and artists will struggle.Mandating Nigerian television, radio and digital platforms to prioritise content from Nigeria – is one idea that has been floated. The government is being asked to consider grants and tax incentives for the sector, as well as low interest loans for Nigerian music studios and concert promoters to reduce the high cost of production.
The industry itself is taking tentative steps to improve its position. The Record Label Proprietors Initiative and the Music Publishers Association of Nigeria are attempting to strengthen copyright law for musicians, all too often the victims of digital piracy. The Collective Management Organisation (CMO) has been launched to allow for the more effective collection of artist royalties.
A lucrative future?
The wealth disparity notwithstanding, Afrobeats still has the potential to play a central part in the growth of the Nigerian music industry.
The country’s music industry as a whole grew at an annual compound growth rate of 5.2% between 2018 and 2023, according to PwC, with the music sector estimated to be worth more than $44m in 2023.
According to Adebayo, Afrobeats’ success has driven massive growth across multiple sectors, from film to fashion and tourism. It’s appeal and success cannot simply be boiled down to digital downloads and record sales.
“Afrobeats’ global success has amplified Nigeria’s cultural export,” he says.
The popularity of Afrobeats has also spurned interest in African music as a whole, opening the door for diverse Nigerian and Africans artists to venture into global markets.
But for Afrobeats to truly be profitable in Nigeria, the industry must build a robust framework to protect local stakeholders, invest in infrastructure and prioritise local content. If that happens, Afrobeats can turn from a global sensation to a sustainable asset.