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Music streams reach record-breaking 4 trillion in 2023

On-demand streaming saw continual growth last year, despite a resurgence in physical media and a full return to live events. It follows similar trends in other industries, emphasising subscription models and digital licensing rather than outright ownership.

In news that will be unsurprising to most, on-demand music streaming saw exceptional growth in 2023.

According to data provided by music and entertainment data analysis firm Luminate, streaming increased by 22.3% over the previous year, surpassing 4 trillion for the first time. 2022 saw 3.4 trillion streams globally.

In the US, R&B/hip-hop remained the most popular musical genre, and made up over a quarter of all streams last year. Rock was a close second, generating 20% of streams with US listeners, while pop songs represented 12%.

Interestingly, Luminate’s research also stated that Gen Z and Millennial listeners are most likely to play foreign language music. Given the huge success of acts like Bad Bunny and BTS with younger consumers, this shouldn’t come as too much of a shock.

World, Latin and country music ranked as the three fastest-growing genres in 2023 among US listeners.

Conversely, Taylor Swift was the biggest artist globally on Spotify last year. In the US, one in every 78 audio streams was for her songs alone, and she boasted over 100,000,000 monthly listeners. Her success in 2023 is considered one of the biggest ever in pop musical history.

Streaming continues to grow despite looming competition

While these numbers are expected, it’s worth noting that streaming has continued to explode despite growing trends toward physical media such as vinyl and CD, especially with Gen Z listeners.

According to Josh Friedlander, senior VP of research and economics at the Recording Industry Association of America, young music fans are seeking and exploring multiple avenues of connection with artists that go beyond just clicking a song and immediately listening.

This could be through physical records, CDs and cassettes, live concerts, and merchandise sales. All of these outlets help to solidify a listener’s association with their favourite artist or genre, and provide unique experiences that go beyond just a song.

Keep in mind too that revenue from physical formats recently hit a decade high. In the UK, CD sales increased for the first time in twenty years in 2023, according to digital retail association ERA. Vinyl has been on the comeback for nearly a decade now and has once again become a regular practice for album rollouts.

Given this competitive climate, it’s impressive that streaming has continued to climb in popularity significantly, especially as the pandemic subsides and consumers are able to venture out to gigs and retailers once more.

Where is the money really going?

The music industry is thriving, at least financially. Perhaps the bigger question is…where is this money going?

Artists have long complained about poor payment from streaming, and Spotify is routinely in the news for controversy over its views on creative expression and artistic output. Just last year, the company was rumoured to be planning a change in payments, opting to give smaller artists even less of a payout per stream.

While we did just mention the rise of CD and physical sales with younger consumers – which is nothing to be scoffed at – the overall dent this has on the industry remains a shadow of its former self.

For example, CD sales accounted for only 3% of US music revenue in 2022, which is down from 92% in 2002. In the first half of 2023, streaming accounted for 84% of total US record music revenue. Friedlander notes that streaming is still ‘the most important driver for the industry.’

So, Spotify is dominating everything. This is convenient for the consumer, but it means that we’re left with a top-heavy royalty system that places most of the money into tech company hands, rather than the people who write, compose, and record the music in the first place.

The industry is booming. Maybe we should be letting the artists enjoy that prosperity a little more.