Insurgents and Incumbents How the 2020s Will Remake the Music Business

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The 20,000 Foot View:  As it enters the third decade of the millennium, the recorded music business is in rude health. Revenues are about to enter the second half of a decade of annual growth, streaming is booming, and investment is pouring in. Simultaneously, the fundamentals of the business are changing, from artist and songwriter careers through music company business models to audience behaviour. However, there is also much that is changing too slowly. The coming decade will underpin a story of old versus new, of insurgents and incumbents. There will be winners and losers on both sides. The factor determining success will be appetite for change.

Key Insights

• The following trends will shape the music business in the 2020s: lean-back listens; fragmented fandom; podcasts; catalogue future; subscriptions slowdown; global markets and culture; content abundance; monetising fandom; live performer crisis; independent artists; songwriter income; distribution versus rights; user-centric licensing; weaponisation of fandom
• These trends will drive even more industry change in the 2020s than streaming did in the 2010s, ushering in the Age of the Artist
• The traditional view of the music industry value chain is progressively less useful for understanding today’s music business
• Therefore, MIDiA has constructed an alternative view: creation; rights and promotion; and distribution
• The most important development will be the growth of creation, a fast-growing sector that will see increased activity, investment and revenue
• Streaming services will increase creator activity, which may create a platform for becoming next-generation music companies rather than starting with rights
• Labels will need to respond or else find their traditional scope squeezed between creation and distribution

Companies and brands mentioned in this report:  Amazon Music, Amuse, Apple Music, BTS, CDbaby, Deezer, Downtown Music Holdings, Ellie Goulding, Facebook, imeem, iTunes, Kobalt, Landr, Last.FM, Level, Loudr, Melboss, Napster, Soundbetter, Soundtrap, Sonalytic, Songtrust, Sony Music, Splice, Spotify, Taylor Swift, Tencent, the Orchard, TikTok, Tunecore, Universal Music Group, Vivendi, Warner Music, YouTube