music industry facts 2020

Wall Street has been taking notice of the music industry’s secular growth story. Universal, Sony, and Warner are collectively referred to as the “Majors,” or the “Big Three.” Industry concentration is relevant in music because the majors’ deals with streaming services benefit from their market share: As streaming services’ revenues grow, so should the majors’ income. Netflix will spend over $17 billion on content in 2020. For example, US musical composition mechanical royalties are regulated by the Copyright Royalty Board (CRB), a panel of three judges who determine music royalty rates and terms over a period of time. According to Music & Copyright, the three largest record labels – Universal Music Group (32% market share), Sony Music Entertainment (20%), and Warner Music Group (16%) – hold a 68% share of the music recording market. Live Nation management expects concerts to return to scale by summer 2021. In fact, Mozart sold the most CDs in 2016, beating out Adele, Drake, and Beyoncé, even though all of those artists had… Furthermore, streaming and digital download margins are roughly 50-60%, compared to physical margins of 40-50%, lower due to manufacturing and distribution costs. He is also a public speaker known for promoting careers in the entertainment industry, as well as an entertainment journalist with over a decade of experience. For the full year, Sirius XM management expects total company sales to decline by 3%. The following statistics highlight how the market still has room to expand: Music royalty payments derive from the underlying intellectual property (IP) rights of songs. Other sources of music income, especially live music, have suffered during the pandemic. Indeed, the modest decline in engagement measured by listening hours has not impacted consumers’ willingness to pay for audio streaming. Music Industry 2020 - China Market Research & Statistics. Global Music Recording Industry Revenues: 2001-2019 ($ Billion). According to IFPI’s 2019 Global Music Report, China was the seventh-largest music recording market, and India was not even in the top 10, despite having the world’s two largest populations. Social distancing restrictions have severely impacted the live music market. Meanwhile, music royalty funds focus on acquiring existing music rights with a history of stable cash flows. IFPI, the organisation that represents the recorded music industry worldwide, today issued its annual Global Music Report. 5. IFPI notes that global streaming revenues grew at a 42% CAGR (compound annual growth rate) since 2015, compared to the entire recording industry’s 9% CAGR. Furthermore, streaming and digital download margins are roughly 50-60%, compared to physical margins of 40-50%, lower due to manufacturing and distribution costs. Music Streaming Market 2020 Statistics, Size, Trends, Technology, Growth with Top Sponsorship Companies Detailed Analysis by Forecast to 2025 ... Piracy is a major problem faced by music industry … In 2019, Netflix shelled out over $15 billion on … Spotify Monthly Active Users (MAUs): 2017-2020 (Q2). As a result, Spotify’s Q2 2020 premium revenue increased by 17% year-on-year. In a future article, I will go deeper into the asset class of royalties and, in particular, why music royalties are considered an attractive asset class in the current market environment. “I swear by Hypebot every morning over breakfast.” Derek Sivers Founder, CD Baby, “Hypebot is the most focused music business centric resource we have.” Celia Hirschman One Little Indian, Downtown Marketing & KCRW-FM. The following chart from IFPI shows the evolution of the industry’s revenue composition and how streaming growth has more than offset declines in physical and downloaded formats over the past decade. Further protections are given under law once the work is registered with the U.S. ASCAP (one of the largest PROs) President Paul Williams noted in April 2020 that as more licensee businesses shut down, the pandemic will “have a material and negative impact financially on almost every category of licensing.”. Music Spend per Capita Across Regions: 2015 (USD). Lucky for us, they’re allowing us to share their insights with you. The convenience and personalization of music streaming, combined with the accessibility afforded by smartphones and smart devices, has driven recorded music’s growth. Global Music Recording Industry Revenues: 2001-2019 ($ Billion). The music industry is responsible for an estimated 1.9 million jobs in the United States alone, per the Recording Industry … As a result, Spotify’s Q2 2020 premium revenue increased by 17% year-on-year. Examples include Universal Music, Sony Music, Warner Music Group, and BMG, to name a few. The growth of digital streaming has allowed consumers to access and enjoy music regardless of social distancing restrictions. For example, US musical composition mechanical royalties are regulated by the Copyright Royalty Board (CRB), a panel of three judges who determine music royalty rates and terms over a period of time. At the same time, other forms of music consumption, especially live, have suffered. They sign performing artists and songwriters and help them create and monetize new music. Industry Revenue Statistics. Inside the results, all three attributed positive growth trends to streaming, but pandemic-related lockdowns negatively impacted non-digital revenues, especially in the areas of merchandise, physicals (e.g., CDs), and artist services. If the economy recovers in 2021, recorded music revenue will return to growth also. Warner Music Group: music publishing revenue 2004-2020 Concert business Share of U.S. consumers who attended live music concerts in 2018 2019 foreshadowed major shifts in … Emerging markets, such as China and India, are only just starting to pay for music IP. Record labels and music publishers are the traditional investors in the space. Meanwhile, the global music publishing industry has proven resilient throughout the economic cycles of the past decade. According to IFPI’s 2019 Global Music Report, China was the seventh-largest music recording market, and India was not even in the top 10, despite having the world’s two largest populations. With the internet and digital technologies driving rapid change within the music industry, articles about new releases and who has been hired and fired are no longer enough. Media and Entertainment; Music… Prominent royalty funds include Hipgnosis Songs Fund, Round Hill Music, Kobalt Capital, Tempo Music Investments, and Shamrock Capital. Monitor the impact on your business. While several streaming services are currently appealing the decision, it could have a very positive impact on composition mechanical royalties for US rightsholders. 2020: State Of The Music Industry. If the trend continues, China and India will increasingly grow as a revenue source for the industry. 02 Despacito by Luis Fonsi and Daddy Yankee have 6.6 billion views on YouTube as of February 2020. The latest music industry news and analysis, including the latest in tech, legal, dealmaking, acquisitions, and broader industry trends. Ariana Grande. With capital pouring into the space, music IP acquisition activity has been hot. In some instances, royalty funds have also signed artists and songwriters to release new music, blurring the line between them and traditional labels and publishers. Additionally, in 2019, the music industry posted a 32.9% growth in paid streaming revenue. iHeartMedia did note that annual revenue declines had improved each month from April (down 50% year-on-year) through July (down 27% year-on-year). 8-tracks took a short-lived run at the dominance of vinyl, cassettes faded away as compact discs took the world by storm, and through it all, the music industry … Barring a major surprise, 2019 will have been the fifth straight year of growth for the global recorded music … Yes, music sales are decreasing. Social distancing restrictions have severely impacted the live music market. In May 2020, Goldman Sachs estimated the entire music industry’s revenue (live, recorded, and publishing) to increase from $62 billion in 2017 to $131 billion in 2030, representing a 6% CAGR. © 2020 Haulix Daily. At Haulix, we often examine the volume of new releases and the reception they see when consider how well things are going. Will Page, the former chief economist at Spotify, estimates that the global publishing business – CISAC collections plus estimates of non-CISAC publisher revenues from Music & Copyright – is worth $11.7 billion in 2020. The most common types of IP are copyrights, trademarks, patents, and trade secrets. Their work considers the changing trends in consumption, the spread of COVID-19, and many more factors that inform what is happening day to day throughout the music business. Engagement with streaming drives growth of the global music market . At Haulix, we often examine the volume of new releases and the reception they see when consider how well things are going. Music sales grew 7.2% in 2019 after being flat in 2018. As a result, royalties paid by radio stations to Performance Rights Organizations (PROs) will likely fall sharply over the next couple of quarters. We also offer combined rates with MusicThinkTank. 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