Music is a part of every day life for most people. We enjoy music on the daily commute, while exercising, or simply when checking out to the newest
everybody is talking about. Therefore, it comes to no surprise that the
has been steadily growing over the last decade. However, while music has been a constant force in the audio world, the way music is consumed has changed dramatically with streaming services becoming an integral part of music consumption. While in 2012 the lion’s share of revenue could be attributed to physical sales, by 2017, digital music streaming had overtaken both physical sales and digital music downloads. In 2021, the
was estimated to reach 17.2 billion U.S. dollars.
Music streaming is the new go-to
The number of music streaming subscribers reflects this development, growing from 304.9 million
global subscribers in the first half of 2019 to an astonishing 616.2 million in the second quarter of 2022. As to be expected with the introduction of new consumption formats, younger generations adapt faster than older generations, with music streaming being no exception. While the generation of baby boomers is slowly picking up their streaming consumption, the
medium is already dominant among millennials and Gen Z. Be that as it may, there are signs that the streaming market is reaching saturation with
revenue growth slowing down significantly over the last years, reaching a rate of 11.5 percent in 2022.
Spotify is dominating the streaming market
In the music streaming market, several services are competing for subscribers. In the lead as of 2022, is Spotify with a
global subscriber market share of 30.6 percent, followed by Apple Music at 13.7 percent, Tencent Music at 13.4, and Amazon at 13.3 percent. Other competitors include YouTube Music and Deezer. In numbers this means that the Stockholm-based streaming giant Spotify has accumulated 210 million subscribers in the third quarter of 2023, in addition to 515 million
monthly active users in the first quarter of 2023. The Swedish service generated the majority of its
revenue through its premium segment rather than ad-supported usage. While music still is the most essential revenue driver for streaming services, it will be interesting to see how the boom of other audio formats such as podcasts or short audio video segments will change the audio landscape and diversify the offer of music streaming services, opening up potential for other market competitors to find their niche.
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