The content of this report will be updated with the latest scenarios based on the global COVID-19 Pandemic
The global music market is expected to witness a CAGR of 8.5% in the forecast period (2020-2025). The music industry has reached at a global in a way it was never before. The global music community has never been more connected, and fans and artists alike are seizing the opportunities of this new era to enjoy and share the music they love.
- The online platforms and social media like Youtube, has provided the upcomming artists opportunities to showcase and present their work to the world. The site is the second most popular social media platform and visited site after Google. The music market is significantly growing in the Asia-Pacific and Latin America region, as the artists are actively seizing the opportunities to break out to the global audience.
- Additonally, the recording companies are extensively investing on music artists, with that the record labels has been the largest investors in the music ecosystem. According to IFPI, record labels invest over Usd 5.8 billion annualy in artists through combined Artists & Repertoire (A&R) and marketing worldwide. Such increase in the investements are expected to continue in the forecast period, which is estimated to drive the music market growth.
- As the market contains higher growth potential along with artists seizing the digital generation opportunity, the music foundations are also making efforts to be place to support their long-term development with sustainability.
Scope of the Report
The scope of the study for the music market landscape has considered the revenue generation by all the formats in the music industry across the world by the recording companies, publication companies and streaming platforms. Also, the report has covered the trends in the industry like the top 10 artists and streaming platforms.
Key Market Trends
Music Streaming to Witness the Largest Revenue Generation
- Along with the rapidly growing internet penetration across the globe, the digital trend has also gracefully adopted by the music industry. The physical music revenue is continuously declining, and online streaming platforms like Spotify, Apple Music, Youtube Premium, and Tindle have taken traction over the years. According to the press release by Spotify, their paid subscribers worldwide have reached 108 million by the second quarter of 2019, with a growth of over 8% from the previous one.
- The companies in the music businesses are extensively making strategic partnerships with the music recording player advanced online music streaming services. For instance, music-focused online service provider Napster has announced to enter into collaboration with Sony Music to launch its new 360 Reality Audio streaming format to consumer companies globally by 2020. This streaming platform Powered, will offer the companies a suite of solutions for music and media streaming, download infrastructure, applications, rights management, customer billing, royalty administration, and business intelligence.
- As discussed earlier, youtube being the second most visited website across worldwide, music streaming is one of the significant reasons for the same. After the song Despacito by the Latin American artist Luis Fonsi - Despacito gained the highest views on Youtube, it gave the music market in the region a boost of growth and investments. According to YouTube, the song has gained 6.39 billion views as of August 2019, followed by Ed Sheeran’s Shape of you at 4.35 billion views.
United States to Dominate the Market
- The music market in the United States in 2018 has been driven by the increase in the revenue of recorded music due to an increasing number of paid subscriptions. According to the report by the music association in the country - RIAA, this number has exceeded the 60 million figure by the second quarter of 2019. Digital and customized radio services have also been a growing trend in the country.
- Additionally, the companies in the region are setting examples by achieving continuous growth in the revenue. For instance, Universal Music Group (UMG) based from New York is backed by Vivendi recently announced that UMG’s revenue in first nine months of 2018 grew by 19.5% to USD 5.63 billion due to significant growth in subscriptions and streaming revenues and also by 14.9% increase in its physical product sales.
- Moreover, the streaming music service providers in the country are strategically competing by launching bundle packs. Financial Times has mentioned that Apple may merge its Apple Music and Apple TV with the launch of its video streaming services and offering bundle pack at USD 13 per month. With this launch, Apple has planned to generate over USD 50 billion in revenue annually by 2020, giving heavy competition to its rival Spotify.
- Such competition and investment by the music recording companies are expected to continue in the forecast period resulting in boosting the music market in the country.
The music market is moderately consolidated because of the dominance by a few key companies in the market like UMG, Sony Music offering recording services and streaming service providers is estimated to continue to face strong competition in the market. These companies are continuously investing in making strategic partnerships and product developments to gain more market share. Some of the recent developments by the companies are listed below.
- October 2019 - AMPED, the indie distribution division of Alliance Entertainment has announced to enter into an agreement to provide physical music distribution service foe veteran punk rock label Epitaph Records and its sister music recording company Anti-.
- September 2019 - Symphonic Distribution, a music recording company launched its new in-house label called sleev3s.
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