Music in the Air 2022
The Remix
We still haven’t
reached peak music.
It’s been more than a decade since streaming music came online, but listeners have barely started turning up the volume. Some 11% of global smartphone users paid for streamed music last year, and Goldman Sachs Research expects this percentage to almost double by 2030.
"We turn more positive on the outlook for physical record sales given the strong outperformance in 2021 and the shift towards vinyl, a segment that has now recorded 15 years of consecutive growth."
People are even buying
more LPs
If consumers look to reduce their streaming spend,
they are more likely to stop paying for
video before audio.
Music streaming should perform better than paid video streaming in a weaker macro environment. In part, that’s because music streaming has a greater foothold than video.
Competition among streamers is strong.
Spotify lost 1.3% of share in 2021 but remains the market leader at 34.4%. YouTube Premium picked up a remarkable 3% of share in the past two years, including 0.6% in 2021. Apple and Amazon
held steady.
The three largest record companies are
They picked up an extra 2.8% of market share in 2021.
But there’s monetization
in the music. Take a look
at Queen.
Access the report
Read the latest Music in the Air report for more on the future of the music industry
GS RESEARCH
GS RESEARCH
GS Research analysis shows that music remains one of the most under-monetized forms of entertainment — spending sits 40% below its historical peak — while consumption continues to grow year after year.
We’re still below what we were spending on music pre-streaming
For an average subscriber,
70%
of overall music listening takes place via streaming,
30%
whereas only
of video consumption is with paid streaming services.
"Although strategic buyers such as Universal Music Group argue that expected returns are well in excess of their cost of capital, catalog investments will likely remain a major debate until we get greater disclosure and clarity on actual returns, or until actual spend comes down. We expect catalog acquisition spend to slow down in a rising interest-rate environment."
Purchasing artists’ back catalogs is big business for now
universal
music group
SONY MUSIC
WARNER MUSIC
GROUP
