Music subscriber market shares 2024: Slowdown? What slowdown?

Record label streaming revenue growth slowed to 6% in 2024 but there was no such slowdown in subscriber growth. In our just published ‘Music subscriber market shares Q4 2024’ report, we reveal that the 85 million net* new subscribers added in 2024 was only two million less than in 2023, resulting in 818 million subscribers and growth of 12% i.e., around double label revenue growth. 

So, just what is going on? How could subscriber and revenue growth become so de-coupled? Normally, the answer for music industry questions like this is ‘it’s complicated’ – but this time it is not. It can be boiled down to two key things: Global South and incentivised growth.

On to those in a bit, but first market shares:

Spotify continues to set the pace: Spotify’s market share (32%) is around where it was in 2015 and has remained relatively stable in all the intervening quarters. That might sound like stasis, but it is anything but. Between 2015 and 2024, the global base of music subscribers grew by more than 850%. So, to maintain market share, Spotify has had to grow at a similar rate. During 2024, Spotify added 28 million subscribers in 2024, that is more than the combined total number of subscribers added by the 2nd, 3rd, and 4th largest DSPs (Tencent, Apple, and Amazon). The simple arithmetic is that when you command a strong market lead, you have to add a lot more subscribers than the rest to maintain your market share. It is easy to take Spotify’s success for granted. Don’t! This is what a highly effective company that retains an obsessive appetite for growth looks like.

Tencent Music Entertainment: Even though it operates in China, Tencent is the 2nd largest DSP globally, with 120 million subscribers. What is more, it grew so strongly that it slightly increased global market share in 2024. Though its key competitor NetEase Cloud Music grew even faster and so gained China market share at Tencent’s expense.

Apple Music and Amazon Music: Apple and Amazon held onto 3rd and 4th spots respectively, but both had underwhelming 2024s, adding just six million subscribers between them.YouTube is making up ground, fast: In percentage terms, YouTube was the fastest growing global DSP in 2024, growing market share and only missing out on knocking Apple off 4th spot by a margin in the low hundreds of thousands. Spotify and YouTube are the ones setting the global pace and though YouTube is far behind Spotify globally, it is the top DSP in a number of key Global South markets, including India. Now, on to why subscriber growth is so much faster than revenue growth:

1. The Global South

The Global South (by which we mean regions that are not North America and Europe) is now the music industry’s growth engine. Last year we entitled our music forecasts report ‘Rise of the Global South’ and our view was borne out in 2024, with these regions accounting for 78% of all subscribers added in 2024. Let that settle in for a moment: four fifths of all subscriber growth came from outside of Europe and North America. Of course, those two regions still account for the majority of revenues, but as subscriber growth slows in those markets, it is lifting off elsewhere. This is nothing less than a rebalancing of the global music industry.

Which creates a major uncoupling of growth metrics for Western rights holders. Global South markets have lower ARPU and Western repertoire share is low there. So, Western rights holders see a double discount on subscriber value compared to Western markets.

2. Incentivised growth

In the first phase of streaming growth, ad supported users acted as the key means of converting subscribers. In mature Western markets, most people on free tiers are there because they like free stuff rather than being prospective subscribers. This is why free trials have become the key tool for driving conversion. In saturated Western markets, it seems that these trials are being used liberally to try to squeeze out the last pockets of subscriber growth. In turn, denting ARPU. 

Consider the case of the US: According to the RIAA’s figures, subscription revenue grew by 5.3% and ARPU growth was 1.9%. Meanwhile US inflation was 2.9% but the streaming price ‘inflation’ rate was 9.1%. So, a $1 price increase resulted in ARPU decreasing by one percentage point in real terms (ie inflation adjusted).

Foundations for more growth

2024 was a great year for global subscriber growth and was a particularly good year for Spotify, YouTube, Tencent, and NetEase. The divergence between revenues and users is clearly cause for concern, but it is better for the long term to be growing subscribers as once you have them monetised you can start focusing on growing monetisation. Hello supremium.

*All growth figures refer to net additions i.e., the difference between the total number of subscribers one year to another. They do not account for churn. The total (gross) number of subscribers added is significantly higher. The net figure thus refers to the total after churned out subscribers have been removed from the totals.