The Digital Media Association (DiMA, which represents services including Spotify and Amazon Music), estimates that music streaming contributed $14.32 billion to the US GDP in 2021.
That’s according to body’s latest report, The Impact of Digital Music Streaming, published earlier this week.
“Quite simply, streaming is a force multiplier for the broader economy. For every $1 in economic value generated by streaming, other sectors of the U.S. economy gain an additional $1.65—an amount more than three times the value generated by the music industry as a whole,” DiMa’s President and CEO Garrett Levin said.
Levin added that the impact is driven in part by streaming services’ investment in research and development, which is something that streaming platforms do at more than twice the US average R&D spending.
“Quite simply, streaming is a force multiplier for the broader economy. For every $1 in economic value generated by streaming, other sectors of the U.S. economy gain an additional $1.65—an amount more than three times the value generated by the music industry as a whole.”
Digital Media Association
DiMA noted that music streaming’s GDP impact is larger than the contribution of the water transportation sector at $12.8 billion and construction machinery manufacturing industries at $11.5 billion.
The GDP contribution of platforms like Amazon Music, Apple Music, Pandora, Spotify and YouTube Music is almost similar to the entire 2021 GDP contribution of Santa Cruz County in California.
The music streaming sector generates its revenue from more than 100 million paying audio streaming subscribers.
“Streaming has reoriented the earning potential of music, resulting in billions of dollars invested in the industry through public stock listings and acquisitions of valuable recording and publishing catalogs,” said Levin.
Earlier data from Midia Research showed that there were 616.2 million subscribers to music streaming services by the end of the first half of 2022, up 17.6% from 523.9 million in the year-ago period.
Most recently, Luminate (formerly MRC Data / Nielsen Music) revealed on April 6 that on-demand audio streams across the world crossed the 1 trillion mark for the first time in the first quarter of 2023.
The same data showed that music listeners have spent roughly 960,000 years streaming music so far this year.
In the labor side, music streaming has also significantly contributed to job creation in the US. The DiMA data showed that for every job directly in music streaming, the US economy gained nine additional jobs via indirect activity in other sectors. This translates to around 92,000 US jobs supported by streaming in 2021.
“These jobs cross many different industries and professions not necessarily associated with music and they are growing at an annual rate of 20%,” Levin said.
Digital music streaming provided about $2.6 billion in direct income to the US economy in 2021. The income came in the form of wages and salaries, benefits, payroll and personal taxes, and proprietor income.
Globally, on-demand audio streams surged 22.6% year over year to 3.4 trillion, according to Luminate’s 2022 Year-End report.
Music Business Worldwide