Creator Tools The Music Industry’s New Top of Funnel

The 20,000 foot view: Music production has traditionally been, at best, an adjacent industry to the recording business, and at worst simply a cost centre. That is now all changing.            disruption catalysed the already-rapid shift towards affordable production tools and the rise of a new generation of online platforms that are reimagining music production as SAAS-based communities. This represents the most important product strategy shift music has faced in decades, but it is also much more than just that. Adding to an already vibrant creator tools marketplace, this new breed of services is reinventing the creative process and will similarly reshape the long-term view of what a music company is. The production business and the recording business are about to become intertwined.

Key Insights

CREATORS AND THE CREATOR TOOLS MARKETPLACE

• Music creators            a large, addressable audience            million            of which            million are self-releasing            direct, up            from            million in           
           was a catalyst for music production:            of independent artists made more music and            did more online collaboration during lockdown, with music software and hardware sales booming and key search terms doubling
• Production, distribution            marketing are the three aspects            the music value chain that            consider most critical to invest            for success:            regularly spend on            and VSTs,            on marketing,            on           

MUSIC PRODUCTION

• FL Studio,            Pro and Ableton Live are            most widely-used digital audio workstations            but this stable market is            transformed by new tools and           
• Artists are            heavily on software and sounds,            electronic music producers spending more            a thousand dollars a year            these categories
• The music            space is saturated, complex and            feel inaccessible to new producers;            are more than 2,000 software            in market. A new breed            music tools is emerging that            focuses on simplicity and elegant           
• The music            market has a long tail            companies but also has a            number of large and medium-sized            including Avid            million), Native Instruments            and Ableton            million)

OUTLOOK

• Music software,            and services generated            million in            with Plugins and VSTs the            single segment            and total revenues            grow to            billion by 2027            sounds and services the two            growth drivers
• Growth will            driven by new models, more            tools and the rise of            services, making the market majority            by 2026, with subscription services                       million by 2027, up            from            in 2019
• SAAS-based creator            are becoming the new top            funnel, establishing meaningful relationships with            before they even release. Creator            will push down the funnel            streaming services will use creator            to push up
• Collaboration and            participation will become ever more            to the making of music,            trend that will be accelerated            younger audiences

Companies and brands mentioned in this report: Ableton, Ableton Live, AIR, Akai Professional, Aloha, Amuse, Android, Apogee, Apple, Arcade, Avid, Beatstars, BandLab, CD Baby, Elk, Fender, fiverr, Google, Image Line, FL Studio, Garageband, Guitar Center, iPhone Pro, Kontakt, LANDR, Logic Pro, Logic Remote, Maschine, Mixcloud, Native Instruments, Output, Pro Tools, Reverb, Roland, Soundbetter, Soundcloud, Soundstorming, Soundtrap, Splice, Spotify, Structure, TikTok, Traktor, TuneCore, Waves, YouTube

NOTE – The dataset published alongside this report includes:

• Music software,            and services revenues and forecasts
• Creator tools            value chain
• Music software            tracker (plugins, VSTs, DAWs, rent-to-own,            DJ tools)
• Creator tools            directory