With the closure of entertainment venues across the world as a result of the coronavirus, the music sector has had to reinvent itself. Digital disruption has come to an industry whose business model before COVID-19 relied on in-person event ticket sales for around half of an estimated $50 billion in total income globally.
From a live set by rapper Travis Scott performed to 12 million virtual fans in the Fortnite video game to London’s Royal Opera House’s free programme of streamed broadcasts as part of its #OurHouseToYourHouse series, music performances will never be the same again.
The pandemic may just quicken an ongoing migration to online streaming. The latest IFPI Global Music Report showed a 22.9% increase in streaming revenue to $11.4 billion for 2019, and for the first time it accounted for more than half (56.1%) of global recorded music revenue.
After a short-term hit to global revenues this year, investment bank Goldman Sachs estimates the music industry could be worth $131 billion by 2030, with Millennial and Gen Z listeners, and smartphones driving the growth in streaming. The big losers in all of this could be the artists, who generate around 75% of their income from live shows, the World Economic Forum estimates.
— By Oliver Rowe (Oliver.Rowe@aicpa-cima.com), an FM magazine senior editor.
