Global share value from music streaming will grow from 76% in 2015 to 95% in 2022, a new forecast by Strategy Analytics has revealed.
[quote font=”georgia” font_size=”22″ font_style=”italic” align=”left” arrow=”yes”]“Streaming music services are proving a better fit for mobile music than music download stores. On the demand-side the growth in mobile streaming is being driven by increasing consumer demand for anywhere and anytime access to tens of millions of tracks via streaming music services, like Apple Music, Google Play Music, Spotify, and YouTube, instead of downloading or side-loading.[/quote]According to the report, titled “Global Mobile Music Forecast 2010-2022”, despite a decline in full-track downloading segment, overall growth in streaming music, both paid and ad-funded free services, are driving the market growth.
Also, the report notes that the majority of streamers use free ad-funded offers, and will remain so until the end of the forecast period.
In markets like Eastern Europe and Latin America, author of the report says that advertising income is already comparable to premium payment.
Although, in most advanced markets, like Western Europe, North America and advanced Asia-Pacific, the advertising income is still very small.
This discrepancy will continue to drive music labels and other right owners to go for higher licensing fees from Over The Top (OTT) services. The battle between paid subscription and ad funded will keep everyone in the mobile music industry on the edge of his seat, says Strategy Analytics.
Speaking on the report, Nitesh Patel, Director, Wireless Media Strategies from Strategy Analysis says: “Streaming music services are proving a better fit for mobile music than music download stores. On the demand-side the growth in mobile streaming is being driven by increasing consumer demand for anywhere and anytime access to tens of millions of tracks via streaming music services, like Apple Music, Google Play Music, Spotify, and YouTube, instead of downloading or side-loading.
“On the supply-side higher, smartphone penetration, as well as competitive data plans offered by operators, including zero-rated and unlimited data plans, are removing consumers’ concern for data overage when listening to music on the move. Furthermore, the ability to store tracks for listening in offline mode has become an option that appeals to consumers in markets where networks may be patchy, or data cost high, or data allowance low,” Patel adds.
Wei Shi, a Wireless Media Strategies analyst and author of the forecast notes that “important markets like Japan, which transitioned late from consumption of physical music to digital music, have largely bypassed download and gone directly to streaming. We have seen competition between services driving prices downwards”.
Shi concludes that “when Apple Music was launched, being a late comer to the market, it applied a more flexible pricing policy in selected markets to challenge incumbents like Spotify. For example, Apple Music’s individual subscription priced $0.20 lower than Spotify in Hong Kong, while its family package is more competitive than Spotify’s in all the markets served by both.”