Music, after the complicated phase of the pandemic and the contextual evolution of the digital sector, driven by streaming, seems to enjoy good prospects according to analysts at Goldman Sachs who have updated their Music in the Air report. According to the new numbers revised upwards, the sector could reach a total of 153 billion dollars in total in 2030.
In recent days, in a meeting with investors, Spotify had presented some estimates for which the company could reach one billion users in 2030 with a 35% margin on streaming music (up from 28% in 2021).
These numbers, together with IFPI data from the Global Music Report are at the center of the debate held on June 15 in Turin, at the Circolo del Design, organized by Unione Industriali and Macchiavelli Music with various speakers from the national music industry.
Goldman Sachs estimates see both recorded music, driven by streaming, which is expected to reach 53 million dollars in 2030 in 2030. In 2021, according to IFPI data, the total of the market reached 25, 9 billion dollars, with a growth of 18.5%, both live music, which after the pause due to the lockdown due to the pandemic is returning to cash and is expected to reach total revenues of 38.3 billion dollars in 2030. The impulse in music publishing is also strong, thanks to the large acquisitions of catalogs, which will reach 11.6 billion dollars in 2030. Goldman Sachs has also hypothesized that in the streaming segment, again in 2030, there will be over 1.2 billions of subscribers to the platforms and the financial company always expects an ARPU (profitability per user) to go from 42.8 dollars a year to 45.8 in 2030: a figure that, as we have seen, is in line with the forecasts of the market leader , Spotify.
Certainly the music streaming sector is experiencing a phase of particular development in all geographical areas. Latin America saw growth of 31.2% and the Middle East and North Africa even 35% with Asia at 16%, USA and Canada + 22% and Europe + 15.4%. 8% increase in Italy, which after years of contained growth and delays in digital technology saw a real explosion of new subscribers to services between 2020 and 2021, significantly transforming the market, with an important generational change also among artists of the repertoire.
But it is not only digital that has caused Goldman Sachs to revise the upward estimates. The physical segment, originally destined for decline, has slowed its fall, and in the vinyl segment has even returned to the levels of thirty years ago with significant numbers.
According to Lisa Young, of Goldman Sachs, the upward revision of the estimates is explained by a certain resilience of the music consumer even in a phase of inflation and macroeconomic difficulties and the significant ability of record companies, in particular the majors, to enjoy a significant advantage in monetizing huge music catalogs that are part of its assets.
Goldman Sachs, in this regard, also confirms what has already been highlighted by IFPI in the report “Engaging with music”. A significant part of the additional revenue will come from emerging platforms, based on advertising for the music sector, which in recent years have seen a strong expansion, such as Instagram, TikTok, Reels, gaming and music podcasts, a segment that is starting to represent the thirty percent of the record industry turnover.
* CEO, FIMI – Federation of the Italian music industry