Table of Contents
Executive Summary
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- Overview
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- Figure 1: Total US streaming revenue, 2014-17
- The issues
- Justifying a paid subscription
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- Figure 2: Paid services, August 2018
- Free listening is too easy
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- Figure 3: Attitudes toward free listening, August 2018
- Getting streaming services to be part of the routine
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- Figure 4: Frequency of audio service use, August 2018
- The opportunities
- Streaming audiences have distinct demographics
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- Figure 5: Listening services used, by key demographics, August 2018
- Emphasizing large libraries
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- Figure 6: Reasons to pay, August 2018
- Reaching listeners on the go
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- Figure 7: Devices used, August 2018
- Strong support for the artists
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- Figure 8: Attitudes toward ethical listening, August 2018
- What it means
The Market – What You Need to Know
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- Streaming category is strong
- Music growth dependent on streaming
- Media landscape favors consolidation, videos
- More opportunities online and offline
Market Size
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- Streaming revenue growing exponentially
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- Figure 9: Total US streaming revenue, 2014-17
Market Breakdown
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- Streaming dominates music revenue
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- Figure 10: US music industry revenues, by share of sector, 2017
- Music subscriptions
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- Figure 11: US paid music subscription revenue, 2014-17
- Figure 12: Number of US paid music subscribers, 2014-17
- Streaming radio
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- Figure 13: US digital and customized radio revenue, 2014-17
- Digital downloads
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- Figure 14: US digital downloads revenue, 2014-17
Media and Music
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- Major acquisitions shaping media landscape
- Shopping, videos dominate online activity
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- Figure 15: Conduction of digital activities, December 2017
- Media apps under essentials and social media
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- Figure 16: Types of apps used in last 30 days, January 2017-March 2018
Market Perspective
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- Concerts boom as music landscape shifts
- Rise of smart tech
- One in five say social media is their main form of entertainment
- 5G networks to boost mobile capability
- Heavy investments in online advertising
Key Players – What You Need to Know
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- Streaming players use similar strategies
- Shortening the distance between service and listener
- Protecting artists’ rights
- Platforms to help the artists
Leading Players
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- Spotify
- Apple Music
- Amazon Music
- Pandora
- SoundCloud
- iHeartRadio
- Tidal
- Google Play
- YouTube Music
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- Figure 17: Google “YouTube Music” mobile advertisement, July 2018
What’s Working?
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- Partnering with networks for greater access
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- Figure 18: Sprint “Introducing Unlimited Plus” email, July 2018
- Cross-entertainment partnerships and promotions
- Getting baked into platforms
- Using less data to stream
- Emphasizing the playlist for discovery
What’s Struggling?
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- Artists could be losing out
- Figuring out what kind of content to allow
What’s Next?
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- Push for open access in streaming
- More investment in the niche
- Direct licensing to cut out record labels
- Get podcasts to fit in
The Consumer – What You Need to Know
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- YouTube dominates listening services
- Most listeners not paying
- More access, few ads important for paid users
- Free listening is too easy
- Subscriptions are the path of least resistance
- Mobile experience essential to streaming
- Seeking relics in a digital age
- Pay the artists
- Emphasizing the benefits of streaming
Services Used
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- Key opportunity
- Free services still most popular
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- Figure 19: Listening services used, August 2018
- Streaming services not as habitual as traditional radio
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- Figure 20: Frequency of audio service use, August 2018
- Key demographics show opportunity for streaming music
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- Figure 21: Listening services used, by key demographics, August 2018
Paid Services
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- Key opportunity
- Two thirds of adults don’t pay for music
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- Figure 22: Paid services, August 2018
- All it takes is one
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- Figure 23: Number of paid services, August 2018
- Most people taking the free option if available…
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- Figure 24: Paid service among all users of service, August 2018
- …but upgrades do happen
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- Figure 25: Attitudes toward upgrading service and using other accounts, August 2018
- Digital downloads still relevant
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- Figure 26: Digital download purchases, August 2018
Reasons to Pay
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- Key opportunity
- Song selection is key
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- Figure 27: Reasons to pay, August 2018
- Accessibility important to Hispanic listeners
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- Figure 28: Reasons to pay – Select items, by Hispanic origin, August 2018
- SoundCloud, Apple dominate discovery
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- Figure 29: Influence of new content, by service used, August 2018
Barriers to Payment
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- Key opportunity
- Listening for free is just too easy
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- Figure 30: Barriers to payment, August 2018
- Young listeners can get what they need already
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- Figure 31: Barriers to payment – Select items, by age, August 2018
Subscriptions
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- Key opportunity
- Narrowing options can help get subscriptions
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- Figure 32: Attitudes toward subscriptions, August 2018
- Parents looking for convenience
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- Figure 33: Attitudes toward subscriptions, by parental status, August 2018
Devices Used
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- Key opportunity
- Phones are just as popular as the car stereo
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- Figure 34: Devices used, August 2018
- Young adults need interaction, older attracted to tradition
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- Figure 35: Devices used – Select items, by age, August 2018
- Services to listen to on the go
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- Figure 36: Mobile devices used, by services used, August 2018
Listening Behaviors
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- Key opportunity
- Old habits die hard
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- Figure 37: Behaviors regarding traditional listening, August 2018
- Discovery and offline listening may not be crucial
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- Figure 38: Listening to discover, August 2018
- Young adults listening to learn
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- Figure 39: Listening to discover, by age, August 2018
Ethical Listening
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- Key opportunity
- Listeners want to do right
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- Figure 40: Attitudes toward ethical listening, August 2018
- Young men care more about the artists than the service
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- Figure 41: Attitudes toward ethical listening, by gender and age, August 2018
Attitudes toward Streaming
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- Key opportunity
- Passive recommendations important to listeners
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- Figure 42: Attitudes toward listening recommendations, August 2018
- Balancing the old and the new
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- Figure 43: Streaming preferences, August 2018
- Young adults get the most out of streaming
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- Figure 44: Attitudes toward streaming – Select items, by age, August 2018
- Black, Hispanic listeners streaming more than anything
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- Figure 45: Attitudes toward streaming – Select items, by race and Hispanic origin, August 2018
- Mobility important for urban listeners
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- Figure 46: Attitudes toward streaming – Select items, by living area, August 2018
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
- Terms
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