Interview
The Music Industry’s Next Steps
- Paid user base is projected to expand from 100 million in 2016 to 340 million in the preceding year, driven by low global smartphone penetration levels of 8%.
- The live music sector anticipates a 75% industry decline this year due to the postponement of 70-80% of events, with full recovery to 2019 pre-pandemic levels not expected until 2022.
- Live music recovery pace remains highly uncertain and contingent on global health and safety regulations, creating significant volatility for promoters expecting zero revenue and artists who derive 50-90% of income from touring.
- Artists face a strategic shift requiring strong social media presence for discovery, while live streaming offers relative success but remains insufficient to recoup lost revenue, as evidenced by 28 million unique viewers for a single Travis Scott event.
- Record labels are expected to gain relevance by supporting home-based recording, direct-to-consumer efforts, and merchandise sales as traditional touring income vanishes.
- Paid streaming penetration is forecast to rise from 8% currently to over 20% by 2030, with penetration reaching 40% in developed markets and 17% in emerging markets.
- Significant price increases for streaming services are anticipated to be absorbable by the market despite current stagnation and a 10% year-on-year decline in average revenue per user (ARPU).
- The combination of rising penetration and price hikes is projected to quadruple streaming revenue from $20 billion last year to $75 billion by 2030.
- The total global music industry value is expected to double to $140 billion by 2030 from 2019 levels, fueled by live music growing at 4-5% and recorded music/publishing growing at 5-7%.