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Streaming is buckling under the weight of new music being released every day, listenership is fragmenting, and artificial intelligence is poised to intensify these challenges. The music industry’s next era of growth lies in monetising fandom, not consumption.

For two decades now, Steam has been one of the go-to digital game distributors, particularly for computer gamers and developers. Yet, its weekly active audience does not quite reflect a fully representative sample of computer gamers. Rather, Steam’s weekly active users (WAUs) are a specific niche of gamers, characterised by their demographics, genre preferences and wider gamer behaviours.

Audiences are consuming in different ways, on different platforms, and at different times – from lean-back passive viewing, to lean-forward on-demand, lean-in social engagement, and lean-through creation. Web 3.0, largely driven by AI, will not change this.

Social media has steadily integrated music, and music creation tools have steadily become more social. These trends are converging, accelerated by shifts in consumer behaviour and artificial intelligence (AI). The result could be a new set of music creation and re-creation tools, integrated within social platforms and geared towards casual consumers.

This report deep dives into the themes identified in MIDiA’s 2023 predictions report. These themes will drive innovation in the digital entertainment landscape in 2023 across music, video, games, audio, cultural trends, and the creator economy. Expect 2023 to be a of period significant disruption and innovation forced upon the digital entertainment industry, as nearly two decades of uninterrupted growth makes way for consumer-led disruption that is driven by a reduction in discretionary spending, attention, and willingness to make do with tired old formats.

Coronavirus pandemic work patterns are now ingrained in the United States, where 42% of consumers work from home and a fifth are hybrid workers. In the ‘new normal’, home workers spend less time on both digital and in-person entertainment compared to those who commute.

The audiobook market is at an important stage of its evolution. Similar to podcasts, the niche format is trying to grow amid heightened competition for consumers’ time and attention, while the looming recession puts subscriptions growth and retention under pressure.

The history of social media has long been defined by continual evolution and iteration, but now shifts across the value chain are becoming more substantive, heralding a new era. Social platforms themselves are changing, and so too are the attitudes, expectations, and behaviours of their users, with audiences’ appetites for carefully curated, heavily edited posts turning sour, and their thirst for authentic, participatory content growing stronger.

In this report, MIDiA Research analysts present their predictions for what will be the big trends in digital media and tech across music, video, games, marketing, audio and cultural trends in 2023 and beyond. Themes for 2023: Cost-of-living crunch: Entertainment spending will weaken, but some formats will fare better than others Perceived value will be king: As economic conditions worsen, consumers will seek out better value for money, not just ways to reduce spend The end of disruption: Following two decades of disruption, consumer tech is entering a ‘holding’ phase, accentuated by the economic downturn Scarcity revival: The post-lockdown thirst for ‘in real life’ (IRL) experiences will combine with digital fatigue to place a new premium on scarce, IRL experiences in 2023 Community repurposed: The value of community will come to the fore in 2023, as entertainment increasingly becomes scene-led The rise of the moment: The immediacy of ‘now’ will find its fullest expression in social and music fusion in 2023 The forking of culture: Cultural intermediaries will provide access to subscenes for larger audiences The authenticity crisis: In an era of replication, authenticity will stand out The decoupling of global distribution: A changing geo-political landscape is turning back the clock on a vision for global markets in entertainment.

The rise of attention inflation means that consumers are maximising their limited time by multitasking between various formats, spurring a rise in background consumption. This creates a “new” space for platforms to compete for consumers’ time. Among entertainment formats, audio is best placed to conquer background listening, but music streaming is more easily relegated to the background than podcasts.

Audiences are changing the ways they interact with entertainment, as well as how they respond to advertising and marketing designed to promote it. Audiences are increasingly creative and engage in lean-through behaviours, are less tolerant of ads, and want more authenticity in their digital social lives.

Investments from major audience platforms in audio infrastructure, such as hosting platforms and advertising, kickstarted the growth of the podcast market. With the basic infrastructure now in place, it is time for the major platforms to focus on growing the format by expanding listenership and user experience.

The Covid pandemic created a unique catalyst for the music creator economy. More time on hands and more cash in pockets gave novices and veterans alike the opportunity to spend both more time and money making music. Though the pandemic was a peak, it also marked the start of a new era for the music creator economy across every one of its aspects, from revenue to creation to remuneration.

The world is facing a period of change and disruption that is unprecedented in modern times. With so many interconnected dynamics across consumer spending, economic cycles, the climate, and even geo-politics, consumer behaviours and spending will undoubtedly be impacted.

The combined effects of market saturation for subscription video on demand (SVOD) alongside a growing cost-of-living crisis are forcing pureplay SVOD services to modify their ad-free propositions. Disney-owned Hulu has demonstrated the viability of an ad-supported SVOD basic plan, which now offers a blueprint for Disney+ and Netflix.

Entertainment consumption and fandom are fragmenting in the internet era as a result of the steady erosion of linear audiences, the rise of asynchronous consumption, and the increased sophistication of personalisation algorithms. Consequently, identity and culture are fragmenting as well.

Streaming first democratised the means of consumption, then distribution, and now production. Though the promise of the long tail may not have materialised quite as expected, long-tail and mid-tail creators are now a central component of the digital-entertainment economy.

Audiences have shifted, first towards the on-demand content delivery model, and now increasingly towards lean-in and lean-through engagement behaviours as a native part of consumption. Advertising strategy and marketing tactics have also had to adapt accordingly.

Though single player remains the preferred games genre for now, multiplayer modes are catching up, particularly among younger gamer segments. As audiences age, multiplayer modes will become increasingly important alongside single-player modes. Both segments will remain important for games companies to pay attention to in the mid to long-term.

This report presents country-level snapshots into the social media usage, engagement habits, and ad tolerances of different social app users. It covers Facebook, Instagram, Twitter, Snapchat, YouTube, TikTok and Discord across MIDiA’s nine surveyed markets of the US, the UK, Australia, Canada, Germany, France, Sweden, South Korea and Brazil.