Luis Fonsi and Daddy Yankee perform onstage at the Billboard Latin Music Awards
Luis Fonsi and Daddy Yankee perform onstage at the Billboard Latin Music Awards
Image: Getty

Each spring, music executives drum up candidates for the so-called song of the summer - unleashing marketing bonanzas in the hopes of scoring a breakout hit that becomes ubiquitous across restaurants, radios and car speakers.

This year’s lead contender has come from an unlikely source: a reggaeton-infused Spanish song, recorded by Luis Fonsi, a 39-year-old Puerto Rican singer known for slow romantic ballads, featuring Daddy Yankee, a Puerto Rican rapper.

Within weeks, “Despacito”, distributed by Vivendi-owned Universal Music, has stretched from Colombian discotecas to London shopping malls, topping music charts in 35 countries, from the UK to Russia. The song reached a new milestone: people have listened to “Despacito” through services such as Spotify more than 4.6bn times - the most in digital music streaming history.

That the world’s most popular song is a Spanish release for the first time in decades is not a coincidence, executives say. Rather, the success of “Despacito” reflects the realities of distributing music in 2017.

The first Spanish-language song to top the UK or US charts since “Macarena” in 1996 is “the early warning of a really massive region that is going to be far more important in the streaming music market than it was in the old music market”, says Mark Mulligan from Midia Research.

The music industry, which was nearly destroyed by piracy, has heralded digital streaming as a new source of revenue growth. Listeners across the globe have begun using services such as Spotify, through which they buy access to 30m songs with the tap of a smartphone button.

Nowhere has the shift been more pronounced than in Latin America, where a growing middle class has ditched CDs in favour of streaming, which is far cheaper. Less than a fifth of Latin American music sales now come from physical formats, the lowest proportion in the world. Streaming income in the region grew 57 per cent last year, fuelling a 12 per cent rise in recorded music sales - double that of global gains.

With 350m potential listeners in Mexico and Brazil alone, Hispanic listeners stream recordings in the billions, giving them a newfound influence on the world’s popular music and a “disproportionate role in making hits”, says Mr Mulligan.

“Despacito” shows how music labels, with the help of Spotify and Apple, can stretch a song beyond its local audience, says Lucian Grainge, chief executive of Universal Music. After years of local investments, now “we can rapidly transform songs from markets such as Brazil, Mexico and Spain into worldwide hits”, he told the Financial Times. UMG, the world’s largest record label, has already made $3m from “Despacito” in the US alone, Billboard estimates.

Jesus Lopez, Chairman/CEO Universal Music Latin America/Iberian Peninsula attends a press conference
Jesus Lopez, Chairman/CEO Universal Music Latin America/Iberian Peninsula attends a press conference
Image: Getty

Jesus Lopez, chief executive of Universal Music Latin America, was behind both “Despacito” and the “Macarena”. He says streaming has “democratised music consumption”, making Latin music relevant on the charts for the first time. “In the past we had to convince radio stations to play a song, but now you can be in France or Italy, see a song is popular, and listen to it immediately,” he says.

It took Mr Lopez years to bring the “Macarena” to the US market, eventually breaking in after Bill Clinton danced to the song at the Democratic National Convention in 1996. Hit-making is faster today: “Despacito” reached the global masses within a month. While the song was a hit from the start, drawing 5m views on YouTube within a day of its January release, the addition of pop star Justin Bieber elevated it in the US. Two days after hearing the song in a Colombian nightclub, the Canadian singer recorded a remixed version, and a week later it topped the US chart.

The “Despacito” hysteria also proves the influence of Spotify’s playlists, the largest of which command tens of millions of listeners. “This is not random,” says Rocio Guerrero, head of content for Spotify’s Latin America division, explaining that “Despacito”’s trajectory mirrors Spotify’s formula.

Spotify first adds a song to local playlists, and if it “works”, as measured by Spotify’s algorithm, it gets pushed to regional playlists, and eventually globally. “It’s kind of like a vicious cycle . . . once they enter the global charts, the rest is history,” she says, noting that Latin music has grown rapidly on the service in the past year, with the third and fourth most popular Spotify playlists now coming from the region.

Mr Lopez also thanks Donald Trump in part for the biggest hit of his career. He says some of the appeal of the song to Hispanic consumers comes in defiance of the US president’s comments about immigrants: “We are proud to be Latino right now,” he said.

This article was originally published by the Financial Times.Copyright The Financial Times Limited 2017.

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