Reports Music

Streaming Music Health Check Streaming’s Watershed Moment

Report by Mark Mulligan
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The 20,000 Foot View:        2016 emerged as a watershed moment for streaming music, with label streaming revenue growing strongly enough to lift overall revenues for all three major labels. Meanwhile Spotify and Apple registered record growth, soon followed by streaming announcements from Amazon, Pandora and iHeart Media. 2016 was the year that streaming stepped up its game, but many of the long-term market challenges remain, such as commercial sustainability of the music subscription business model, concentration of growth and consumer willingness to pay. In this report, we pull together data from record labels, music services and consumers to create a definitive assessment of where the streaming music market has got to. Key Findings

  • By September 2016, Spotify had        million subscribers (with        billion paid to rights holders to date) while Apple had        million subscribers
  • Competition is hotting up with announcements from Amazon, Pandora and Vevo
  • Each of the three major labels experienced strong streaming year-on-year revenue growth in        2016: Sony        Universal        and Warner       
  • In        2016, major label download revenue fell by        million quarter-on-quarter, only        million less than the        million by which streaming grew
  • Paid subscribers rose globally from        million in        2015 to        million in        2016. However, Spotify and Apple accounted for virtually all the growth
  •        of all streams were mobile, rising to        for Napster        of UK subscribers and        of UK free streamers regularly stream on Wi-Fi        of all streams come from playlists. However, just        come from push playlists        of UK subscribers say that playlists are replacing albums for them, while        say they are using curated playlists more than        months ago
  • Just        of Swedes spend more than        on music, reflecting that subscriptions have capped spending of super fans
  •        of subscribers have changed subscription service, falling to just        in Sweden thanks to Spotify loyalists         of UK subscribers sign up to multiple streaming trials with different email addresses, while        use free trials to get access to exclusive albums

Companies mentioned in this report: Alphabet, Amazon, Anghami, Apple, Beatport, Deezer, Google, iHeart, KKBox, Last.FM, MelOn,        Napster, Orange, Pandora, QQ Music, Rdio, Sony Music, SoundCloud, Spotify, Tidal, Universal Music, Vevo, Warner Music, YouTube

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