Q3 streaming trends: Why Spotify’s growth in the Global South matters for the music industry

For much of 2024, music industry discourse centred around Spotify’s content mix. The growing long-tail of artists and songs on the platform is what fueled Universal Music Group’s two-tiered royalty system, and rights holders continue to raise concerns about sharing space with audiobooks and podcasts. But in 2025, record labels may pay increased attention to how Spotify’s customer mix has shifted over the past four years — particularly its growth in the Global South — a trend that is likely to continue. Tucked into pages 14 and 15 of Spotify’s strong Q3 earnings results are charts reflecting monthly active users (MAUs) and premium subscribers by global region. In both cases, North America’s proportion of the total is getting smaller – a clear sign of notable Q3 streaming trends in emerging markets within the music industry

Between Q3 2020 and Q3 2024, the Rest of World’s contribution to global MAUs grew from 19% to 33%, now representing the largest share. Meanwhile, North America's contribution shrank from 25% to 18%, and Latin America held steady at 22%. As expected, the customer shift is more dramatic for MAUs, which includes free users, than for subscribers. Europe still makes up the largest chunk of subscribers (38% in Q3 ‘24, although down from 40% in Q3 ‘20), followed by North America (27%, down from 29%). Meanwhile, Latin America’s proportion grew from 20% to 22% and Rest of World from 10% to 14%. 

Spotify’s growth in the Global South reflects a larger shift, whereby these music industry markets (Latin America, Asia Pacific, and the Rest of World) will account for the vast majority of global music user and subscriber growth to come. Cue a ripple effect:

• Non-Western markets will account for a greater share of streams: User growth from non-Western markets does not have quite as outsized an impact on the total revenue pie, as these regions have a lower average revenue per user (ARPU). However, because that revenue pie is distributed by streamshare, it matters what all these new users are listening to. Increasingly, they are turning to domestic artists. A mounting body of research, including Will Page and Chris Dalla Riva’s “glocalisation” paper published earlier this year, is proving that more local artists are topping their local charts on global streaming platforms, and in their native languages.

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• Decoupling the global centres of culture from the global centres of revenue: As streaming grows in regions with large populations and strong local repertoire, but lower ARPU, we will see a divergence — or shall we say, bifurcation? The Western world will continue to drive the majority of global recorded music revenue. Yet global music culture and global music charts will be increasingly driven by the consumption habits of the non-Western world. 

• The “double discount”: Here is where the above two trends come together. Western rights holders get a “double discount” on revenue when streaming grows in Global South markets: Not only do these regions have lower ARPU, but Western rights holders have lower repertoire share there. MIDiA highlighted the double discount dynamic in August — it is part of what explained a divergence in Universal Music Group’s and Spotify’s earnings results. 

Perhaps the only thing that can stop this ripple effect, or at least contain it, is if Western labels simply acquire more catalogue in the regions where Spotify is growing the most users. And of course, that is already happening. Expect to see more mergers and acquisitions  in Global South markets in 2025 as well as a a shift in the streaming conversation from content to customers.

To hear more about this trend and others to watch next year, sign up for MIDiA Research’s free 2025 Predictions Webinar, coming up on Dec 5. Also look out for MIDiA’s upcoming report, ‘Global South rising: A snapshot of streaming audiences in China, Turkey, and South Africa’.