By Alexandra Bacchus
- Music streaming brings in about 80% of the music industry’s total revenue
- Hip hop and rap songs made up more than 25% of all on-demand music streams in 2018
Gone are the days that we wait in line for CDs and listen to full albums on repeat. Instead, music streaming dominates the industry and has become the primary way we consume music. What’s more, hip hop and R&B have come out on top, surpassing rock as the most listened-to genre for the first time in 2017. There is money to be made in this, as experts predict streaming revenue will double to $131 billion by the year 2030 because more people will value easy access to music.
Why This Matters: In many ways, platforms like Spotify (SPOT -2.63%) and Apple (AAPL -0.50%) Music have made the process more democratic, so people can easily discover music and listen to whatever they want without owning it. This has likely led to the increase in consumption of hip hop, rap, and R&B songs with every demographic. In 2018, over 24% of streamed songs in the U.S. came from rap artists. SoundCloud is just one example of a site that made an underground music scene more visible, launching names like Chance the Rapper and Bryson Tiller, who released music as unsigned artists before making it big.
In 2018, over 24% of streamed songs in the U.S. came from rap artists
This big shift to streaming has also changed the way music operates, as the industry struggles with how to measure an artists’ success on the charts through on-demand streams alone. In 2014, Billboard decided to count 1,500 streamed songs from an artist as one album sale. This means that the more times an artist’s song is played on a platform, even if it’s the same song on repeat, the more “album sales” occur and the more money an artist makes. This has led to rappers like Drake and Chris Brown releasing marathon albums in the past few years that feature dozens of songs totaling several hours of listening time, increasing their likelihood of having a winner that will carry the album to Platinum. Record labels are also all in on streaming. Revenues for Universal Music Group during the first half of 2018 amounted to more than $3 billion, led by a 34.3% spike in streaming revenues.
What’s Next: The growth of these streaming providers will inevitably lead to greater evolution within the music industry because it all comes back to how artists can make money. We will likely see shorter songs, longer albums, and flashier singles as a way for artists to grab our attention and rack up streams. It will also bring variety and discovery as every song is just a few taps or clicks away, and sharing that music with the world is easier than ever.
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