By CultureBanx Team
- Goldman Sachs forecast global music revenue is going to nearly double to $142B by 2030
- Black listeners are the largest user group for music streaming services
Streaming platforms take center stage in Goldman Sachs (GS -1.11%) latest music revenue report, which estimates it’s going to more than double to $142 billion by 2030, far surpassing 2019s $77 billion. The lockdown has accelerated the shift towards music streaming, and currently sales in this category are dominated by top R&B and hip-hop artists such as Drake, Kendrick Lamar, The Weeknd, Migos and Cardi B. Music publishers and labels also stand to profit greatly from the rise of streaming, led by black listeners who are the largest user group.
Why This Matters: As the streaming market strengthens, prices are likely to rise. Consider this: The average price of a standard music streaming subscription has remained unchanged at $9.99 for the past decade, a number that’s likely to change.
The Black community they are far outpacing millennials and spend about $173 annually on purchased music
An estimated 21% of smartphone users will be paying for streaming subscriptions by 2030, buoyed in part by new streaming platforms and more devices, according to the report. Specifically, the Wall Street firm wrote “the habits we’ve formed during lockdown, such as relying on social media and rediscovering old tracks, are set to accelerate the online shift and propel global music revenues to new highs.
R&B and hip-hop are music’s most consumed genre. In 2017, Goldman found live music, publishing and recorded songs made $26 billion, $6 billion and $30 billion respectively. The firm estimates by 2030 the biggest gain will be seen in recorded songs at $80 billion. Recorded songs which fall into the streaming category will grow the most especially if we look at Nielsen’s Music Mid-Year 2018 Report, U.S. that notes music consumption rose 18.4%.
Millennials are the main group helping to revitalize the music industry. Goldman noted that 16-34 year olds in the U.S., a demographic that encompasses millennials reported using music streaming services in 2019. The financial company previously wrote this faction is willing to shell out a hefty portion of their yearly budget on music, to the tune of $163. Specifically, when it comes to the Black community they are far outpacing millennials and spend about $173 annually on purchased music, according to Nielsen.
Situational Awareness: The global music industry has been hit hard by the COVID-19 pandemic, the slump is likely to be short-lived and Goldman noted music revenue will drop by 25% in 2020, largely due to the widespread disruption to live events.
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