The latest issue of Music & Copyright is now available for subscribers to download. Here are some of the highlights.
On-demand music subscription sector hits new milestones despite slowdown in overall growth
The on-demand music subscription sector experienced a positive 2019, with several international and local services reporting solid operating details. Spotify ended the year in the driving seat, with subscription gains boosting the service’s market share. Apple Music also registered growth, but the service lost market share to both the leader and Amazon. The three major music groups are benefiting from the rise in access services, with all reporting favorable financial results driven largely by streaming. The rise of the paid subscription from a niche revenue source not so long ago is impressive, and the year-end record company results have illustrated the importance of access services to the companies’ bottom lines. Despite the inevitable slowdown in service take-up in Western countries, developing markets are starting to show that they are well placed to step in and soften any decline.
French recorded-music sales see fourth consecutive year of growth
French music trade association SNEP has reported a fourth straight year of growth for trade earnings from recorded-music sales. For the first time, revenue from audio streaming generated more than half of local record company income. In another first, sales of premium subscriptions overtook physical formats. Subscription sales recorded a very positive year, with the number of net new subscriptions rising sharply. However, it was advertising revenue from audio service that scored the highest growth of any income stream. With the exception of music video, all the buy-to-own formats suffered year-on-year declines. Trade earnings from CD album sales continued to fall, and the vinyl revival took a hit, although the number of units shipped to retail continued to rise along with sales of turntables.
Time for record companies to push the music and gaming space convergence
The gaming sector continues to grow apace, with esports events capable of attracting large in situ and online audiences. While a number of music industry players having recognized the potential of adding music – both recorded and live – to the gaming mix, many have yet to take even baby steps into the space. Esports arenas can clearly double up as music venues, and a number of such mixed-use facilities are either up and running or in the pipeline around the world. Expect to see more of these spots as well as – finally – an increasing number of music companies coming onboard as partners in gaming ventures. More experimentation is necessary to ensure that esports doesn’t remain an electronic music enclave.
China country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed China music industry report. China’s relatively buoyant economy is reflected in several sectors of the country’s music industry. Often described as an emerging market, retail sales in the country show the country is more than living up to its long-held potential. China’s digital infrastructure is highly developed and with smartphone penetration on the rise, all the requirements for digital growth are firmly in place. Royalty collections have grown consistently for the last nine or so years but given the size of the population and level of music use, rights holders’ earnings measured at a per capita rate are tiny.
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