Market Size
Intellectual property (IP) represents the core of the music industry. The estimated global worth of this asset is colossal, speculated to be over 700 billion dollars, yet it remains immeasurable due to the lack of an open market.
The industry outlook is impressive. Total gross revenues (including recording, publishing, and live events) were around $70 billion in 2021 and are expected to rise to $153 billion in 2030 (Source: Goldman Sachs - EQUITY RESEARCH | June 13, 2022). The International Federation of the Phonographic Industry (IFPI) makes similar projections, even if based on different assumptions.
| 2021 Global Music Market | 2030 Global Music Market (Expectation) |
|---|---|
USD 70.8 Bn | USD 153 Bn |
According to the IFPI, global recorded music revenues grew 9% to $26.2bn in 2022. There were 589 million users of paid streaming subscriptions at the end of 2021. Streaming revenues (incl. subscription and advertising) grew by 11.5% to $17.5bn in 2021, accounting for 67% of the total. It's projected that by 2030E, global subscriber penetration, as a percentage of smartphone owners, will rise to 20%, up from 11% in 2021. This is one of the main drivers of growth.
Growth of Revenues YoY from 2021 to 2022
| Streaming | Physical | Performance Rights | Synchronisation | Downloading and digital |
|---|---|---|---|---|
+ 11.5% | + 4% | + 8.6% | +22.3% | -11.7% |
This optimism is based on the level of streaming diffusion, which, according to estimates, still has margins for growth in terms of the number of users and in terms of price per person. However, there are also other interesting viewpoints.
New technologies emerging into the mainstream have the potential for another positive shock to the industry – blockchain and AI. Unlike the advent of digital, which disrupted the industry's balance and led to a significant revenue crisis in the early years, these new technologies can instead be used to enhance current business models both in terms of content creation and distribution and in terms of optimising financial flows and, therefore, the intrinsic value of musical IP.
Both of these areas open up possibilities for market operators such as labels, artists, and distributors, startups undertaking projects in Music Tech, and investment funds positioning themselves in this new vertical of innovation.
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