A new report published by Counterpoint Research predicts that the number of music streaming subscriptions globally will exceed 450 million by the end of 2020, which would be more than a 25% year-on-year increase.
Counterpoint reports that global music streaming subscriptions grew 32% YoY to reach 358m subscribers by the end of 2019.
Spotify revealed in its Q4 2019 financial update on February 5 that it ended December 2019 with 124m Premium subscribers and 271m total Monthly Active Users (MAUs) worldwide.
Apple Music follows in second place with a 24% share of total revenues in the industry and a 19% share of the total paid subscriptions, claims Counterpoint, which adds that Apple Music’s subscription base grew 36% YoY in 2019.
Tencent Music, including QQ Music, Kugou and Kuwo which it runs in China, ended 2019 with an 11% market share.
Abhilash Kumar, Counterpoint
Counterpoint Research Analyst, Abhilash Kumar, said: “Paid subscriptions grew 32% YoY compared to 23% YoY growth of total MAUs.
“This suggests people are ready to pay for music streaming for a hassle-free experience. However, this is not completely user-driven.
“Music streaming platforms are following a two-step approach to gain subscribers, first registering them to their platform as free users by means of excellent advertising campaigns and secondly pitching them with attractive offers to transfer them to become paying subscribers.
Added Kumar: “Spotify maintained its top spot with the help of promotional activities like free Spotify Premium for three months, price cuts, customized campaigns like Spotify and a focus on exclusive content.
“Tech giants like Amazon, Apple, Google have started focusing on music streaming and have sufficient cash at their disposal to give stiff competition to Spotify.
“Apple Music is making improvements in its app like the introduction of night mode, curated playlists to target a group, etc. Similarly, Amazon Music has been trying lossless music and is creating its own niche where it competes with Tidal.”
Kumar added: “We expect the OTT sector will experience an uptick as people stay at home actively tracking the latest updates.
“During this outbreak, audio OTT consumption has switched from music streaming to the radio. People in highly affected areas are worried about the outbreak and are therefore continuously tuned to news on TV/radio for updates.
“The traction of news channels and podcasts saw an upswing while that for music streaming dropped.”Music Business Worldwide