The Day the Swedish Music Wonder Is Dead

Submitted by Peter Åstedt

Right now, there is more money in the music industry than ever! Yes, it’s true right now there is money floating around inside the industry than ever. It’s so much that several financial people consider it a financial bubble. So where is it you ask if you work as a musician or in a record company?

Of course, this is floating around in IT companies. In the past years, it has become trendy to invest in IT companies that contain music. Of course, the majority of these companies are start-ups with really no clear or good business structure. Let’s take a look at the second Swedish music wonder.

The first Swedish music wonder was in the 80’s 90’s and beginning in 2000. Here you have many songwriters and artists that made Sweden famous as a creative country with good musicians and songwriters. You have a bunch of cool artists that you know are Swedish beyond ABBA like The Hives, The Cardigans, Eagle Eye Cherry, Avicii, Europe, Ace of Base, Roxette, Ghost, In Flames the list just goes on and on. But at the end of the 90’s, the Swedish government made a decision that would change this wave into what is called the second Swedish music wonder.

On a panel, I once said regarding Sweden that if you give nine million monkeys a computer, they will invent Pirate Bay. Because that happened, the Swedish government back in the late 90’s wanted the internet to become a household item. They put off taxes on computers and broadband in the end it was so cheap for everyone to get a decent computer and hook it up to the new internet that everybody was talking about it. What we did was of course to build illegal things like Pirate Bay even Kazaa was built by Swedes.

Then we started to build things that were not illegal like Skype (same guys as Kazaa) and then late in 2000 Spotify saw the light. After that several digital big music companies have come out of Sweden and that is called the second wave of Swedish music wonders.

The thing with most of these companies is that they gathered a lot of investors to even survive. Today many of these are big on the big international market like Spotify another we can look into is Epidemic Sound. Both have a big share of the segment of what they are doing in the digital music industry. Both host several hundred employees and both have not made any profit even though they are the biggest in their segment. Still, they are driven by investors’ money and have been doing that for almost ten years. Not a good sign and not sustainable.

Also, like Pirate Bay, these companies’ business models haven’t benefited those who created their content and also built the cornerstones for them to stand on. And when we now are going into a finical crisis, something these companies never had to deal with since Sweden escaped the last finance crisis very light, would they even survive? Since quite many are sure that all these companies are built on a financial bubble and investors are the first ones to leave the market will it all go down?

Probably not. They will be sold to big companies that still have money during  low financial periods. Probably from countries with not the most democratic rules like China. The ironic thing of the whole overview is that all these companies are built on the strong laws of copyright. I wonder if China will change their view on copyright if they own companies that make that kind of money?

What they leave behind is a big hole in the Swedish music wonder. I already also see a lot of the entrepreneurs that built the first wave leaving the industry for something else. So when will it be over? Or we Sweden rise again in a new way in the music industry for a third wave?

Editor’s Note: Peter Åstedt has been working in the music industry for over 30 years. He has started record labels, distribution systems, and publishing companies. Peter also runs several major showcase festivals and is an advisor for INES and co-founder of MusicHelp/Discover Sensation. He has worked with the Top Ten most streamed songs and had music on both the Olympics and Super Bowl. Peter has currently taken up the seat of Station Manager of Cashbox Radio, working with MD, PD and station owner, Sandy Graham. In 2021, he worked as the European Consultant for Heal the Earth – An Earth Day Celebration. His latest venture is a new Showcase Festival in Sweden, Future Echoes Peter is a Managing Partner and Editor of the newly launched Record World International.