Recorded music market 2022 | Reality bites

Following a spectacular 12 months of progress in 2021, world recorded music income progress slowed considerably in 2022 because of the mixed impression of world financial headwinds and progress slowdown in mature streaming markets. Context, although, is every thing – not many industries can ship strong progress whereas the worldwide financial system is in turmoil, advert markets are falling and lots of rising tech sectors are in disaster.

Global recorded music progress has oscillated in recent times, slowing within the pandemic, booming in 2021, after which returning to extra modest progress in 2022.

2022 was a 12 months of realignment for a lot of the worldwide financial system, and the music enterprise needed to contend not solely with the broader pattern of the cost-of-living-crisis, but additionally rising rates of interest softening music catalogue M+A requirement and the lengthy anticipated streaming slowdown kicking in. It is testomony to the solidity of the recorded music market that, regardless of these a number of headwinds, world revenues grew by 6.7% to achieve $31.2 billion in 2022. While this was considerably down on the 24.8% registered in 2021, it illustrates the robust function music performs in customers’ lives, particularly in unsure occasions when escapism and identification are extra necessary than ever. The persistent worth of music was much more strongly illustrated by music publishing, which grew by 16.6% in 2022.

Streaming was once more the principle driver of trade progress, with revenues up by $1.5 billion in 2022 (8.3% progress), although this was lower than half the $4.2 billion added in 2021.  The slowdown was underpinned by a) slowing subscriptions progress in mature markets; b) a slowdown in ad-supported revenues, reflecting wider promoting market dynamics. Music subscriber progress was markedly stronger, up by 13.7% to 652 million, nonetheless, the extra mature North America and Europe areas accounted for only a third of the expansion. Emerging markets will grow to be a progressively bigger a part of world streaming progress, however on account of decrease ARPU and low shares of Anglo repertoire, the divergence between progress income and subscriber progress charges seen in 2022 will grow to be a long-term market attribute.

Independent labels and artists direct each strongly out-performed the broader streaming market, rising streaming revenues by 13.9% and 17.9% respectively. In phrases of complete recorded music revenues, 

UMG added extra recorded music income in 2022 than the opposite two majors, including $0.5 billion to achieve $9.2 billion, giving it a 29.5% share of the worldwide recorded music market. UMG’s proportion progress (6.2%), although, was slower than SMG’s (8.7%), with SMG gaining 0.4 factors of market share.

Artists direct (i.e., artists who launch with out labels, straight through a distributor) have been the massive success story as soon as once more, rising by 16.6% in 2022 to generate $1.7 billion of recorded music income, giving it a 5.7% market share, up from 5.2% in 2021. 

Independent labels additionally outgrew the broader market (up by 7.1%), and the mixed market share of artists direct and unbiased labels reached 34.6% in 2022, up from 34.0% in 2021. Though it’s value noting that this doesn’t embody the extra income from unbiased labels distributed by main labels.

Combined, unbiased labels and artists direct, have been the biggest single market phase with $10.8 billion.

Though total market progress was down in 2022 in comparison with 2021, 2021 was in lots of respects a 12 months of artificially accentuated, post-Covid progress, whereas 2022 was on the reverse finish of the size, with a number of financial headwinds. In this context, 6.7% progress for 2022 may very well be thought of much more of an achievement than the 24.8% achieved in 2021.

The full report and dataset (with quarterly income by phase and format going again to Q1 2015) will probably be shortly out there to MIDiA purchasers. If you aren’t a MIDiA consumer and want to learn to get entry to our analysis, information and evaluation, electronic mail stephen@midiaresearch.com