Reports Music

Streaming Music Growth How The S-Curve Will Determine Growth

Report by Mark Mulligan
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The 20,000 Foot View: Streaming music drove trade revenues of            billion in 2016, up            from            billion in 2015 while music subscribers grew from            million to            million over the same period. The rate at which the streaming music market will grow, and the level at which it will peak, is determined not just by industry strategy but also by the underlying laws of consumer adoption. Over the course of the last            years, adoption of consumer-driven technologies has adhered to the s-curve adoption pattern. Though the rate of adoption has accelerated in the digital era, the underlying principles continue to shape consumer driven markets and will determine the outlook for streaming music. In this report, we use            years’ worth of consumer adoption data to identify streaming music’s growth potential.

Key Findings: 

  • With technology            humans behave in highly predictable            defined by cohorts of personality            and their attitudes to technology
  • The net            of technology making its way            five key consumer groups is            adoption typically follows an ‘S-Curve’
  • Technology adoption            becoming faster. Radio took            years            reach ubiquitous penetration while the            took just            years
  • Meanwhile, messaging            are reaching market maturity within            a few years
  • Technologies can            as quickly as they decline,            the pattern of decline a            image of the growth curve
  • The modern            music business is built upon            replacement cycles, with adoption curves            to the s-curve model
  • Streaming is            the latest format replacement cycle            is set to replace downloads            a like-for-like basis, as well            mopping up some legacy CD           
  • The peak            the pre-decline music industry was            by pricing inflation
  • The average            per music unit sold in            was            by 1996 it was            the same period, music sales            by            in volume terms but            value terms
  • Based on            s-curve adoption data and growth            date, the growth potential for            streaming music market is in                       billion range by 2025
  • Streaming has            potential to become the lion’s            of the recorded music business            2025, but that path is            set, with pricing a key            determinant

Companies and brands mentioned in this report: Apple, Facebook, HMV,, Napster, Panasonic, Spotify, Sony, Tower Records, Vevo, YouTube