According to a recent report published by Goldman Sachs analyst Lisa Yang, the global music industry is set to grow to $41 billion by the year 2030.
Year-over-year growth for 2023 is estimated at 9% according to another report, the IFPI Global Music Report.
As of this year, a lot of the music industry has bounced back after the pandemic put a kink into so many different areas of music revenues. While some sectors are still in recovery or have had to change how they’re administrated, overall, growth remains resilient and has either already returned or is returning to pre-pandemic levels.
Interestingly, Asia is where the most growth is happening in the music industry with year-over-year growth of approximately 15.4%. For the first time this year, China became a top 5 music market with 20% annual growth in 2022. In the meantime, here are some other numbers from a geographical music growth breakdown.
- Australasia grew by 8.1% annually.
- Europe grew by 7.5% and is the second-largest music region in the world.
- Latin America grew by a massive 25.9% in 2022.
- Middle East/North Africa grew by 23.9% annually.
- Sub-Saharan Africa grew by 30% growth and is the fastest-growing region in the world in terms of music business revenue growth.
- US revenues grew by 4.8% in 2022 and remains the world’s largest music market, exceeding $10 billion in value for the first time.
- Canada music business revenues increased by 8.1% during the same time period.
What Categories Of Music Business Are Growing?
It is predicted that the majority of this growth will happen from streaming platforms and related services, such as Spotify subscriber revenues.
Streaming revenues alone are set to account for approximately $34 billion of total revenues, with $28 billion of this expected to be from paid subscriptions and $6 billion from ad-supported free streaming services. Spotify is leading the way, however, you also have YouTube Music, Apple Music, and other services balancing out market share.
Another $4 billion is predicted to come from performance rights, and physical and digital downloads are expected to amount to $700 million by the end of the decade.
While digital downloads are down, vinyl records sales are up and increasing, demonstrating how physical releases are regaining momentum after years of growth almost strictly being reserved for online file downloads.
What Does Music Business Growth Mean For The Corporate Music World?
As the music industry continues to grow, this is great news for companies such as Universal Music Group (UMG) and Sony Music Entertainment, both of which continue to make record profits in the music industry.
UMG, in particular, is currently valued at $23.3 billion and it’s only expected to grow in the coming years. By 2030, the company’s revenues are expected to be twice their current level.
This marks significant growth that, when combined with the predictions surrounding streaming, may create a climate wherein the industry as a whole is as powerful as ever before.
Here is why this is a bad thing. The entities making that money are corporations. That money is not going back into the artists, at least not consistently, and it’s only serving to corporatize the industry as a whole.
The impact that such a large amount of growth could have seems like it could be good for everyone but that’s not necessarily true. A select number of people are going to collect those gains while the vast majority of musicians submitting and publishing recorded music could simply end up exploited.
Even with the advantages of a record label or self-releasing music and going at it independently, the risk still exists.
How Will Music Business Growth Impact The Sound Of Music?
How music business growth impacts the way that music sounds, the ways in which live tours are booked, and paying attention to who breaks through into mainstream culture is going to be interesting to watch. We’re already seeing lots of changes occurring as either a part of this growth or as a response to it.
An area that is struggling a bit is live touring. Costs are up across the board. It just might not be worth it for all artists to tour as they used to. More residences by older artists and established artists, however, are paving the way for a new model of launching a tour.
Another area that is experiencing growth yet with some difficulty are stakeholders that are independently-supported. For independent record labels, independently-owned recording studios, and indie music as a whole may need to seek success elsewhere.
There’s already no way to compete with the promotion budgets of major corporate music brands. As they continue to grow in power, the artists who are not already being bought and sold within the corporate system are going to have to depend on their wits and luck to make money.
If you think that trying to make money in the music industry is hard today, a decade from now it will be even tougher.
Yes, tech has opened up many opportunities for music on TV, film, and media in general. There is more music readily available today than ever before and more people making music than ever before. However, the competition is high across the board, and there’s virtually no way other than luck and smart decision-making to cut through all that noise.
The more powerful the corporate music industry becomes, the more creative independent producers are going to have to get to compete and make a living.