Global Recorded Music Experienced Strong Growth in 2023
Global recorded music, led by streaming, experienced its ninth consecutive year of revenue growth – while overseas growth remains robust.
Global recorded music revenues grew 10.2% to $28.6 billion from $26 billion in 2022, according to the International Federation of the Phonographic Industry’s (IFPI) 2024 Global Music Report.[1] At the same time, Midia Research, released a similar report noting global music revenue grew by 9.8% in 2023 to $35.1 billion.[2] This was the industry’s ninth year of consecutive revenue growth, according to IFPI.
Strong Gains in Music Revenue
Global recorded music revenues experienced their ninth consecutive year of growth, having more than doubled from their low of $13 billion in 2014. Streaming accounted for the majority of both 2023 revenue and revenue growth.
Midia’s global revenue number was higher than IFPI’s. Midia includes “expanded rights” which includes revenue from merchandise, touring, and branding, which are not included in IFPI’s numbers.2 Despite differences in the way that revenue is calculated, the growth in revenue is similar in both reports.
Streaming Leads the Way
Streaming remains the dominant way individuals listen to music, representing 67.3% of global revenues. Subscription (or paid) streaming accounted for 48.9% of global revenue while ad-supported streaming represented 18.5%.
Growth in overall streaming revenue grew 10.4% in 2023. This was lower than the 11.4% growth rate in 2022. However, subscription revenues rose 11.2% in 2023, which was higher than the 10.1% rate in 2022.
Overseas Growth Remains Strong
Music is a global phenomenon, and 2023’s revenue growth numbers confirm this. While U.S. growth was strong, international gains were stronger.
Sub-Saharan Africa saw a 24.7% growth in music revenues led by an almost 20% rate of growth in South Africa which represents 77% of the region’s totals.
Latin America saw revenues grow 19.4% led by gains in Mexico and Brazil of 18.2% and 13.4%, respectively.
Asia saw revenue growth of 14.9%, led by a 25.9% increase in China. Asia also continued to benefit from strong sales from K-pop acts.
They Still Buy Physical Music
Revenues from physical music sales grew 13.4% in 2023, higher than the 3.8% growth rate of 2022. Strong gains in CD revenues and continued interest in vinyl fueled the gains. Additionally, Asia was the leading region for physical sales as K-pop music boosted sales.
Rounding out 2023 was a 4.7% increase in synchronization revenue and a 9.5% increase in performance rights.
Why Consider Music
The IFPI report shows that music continues to grow. New technologies like streaming make music more accessible to more people. Additionally, music is not just a US phenomenon. The industry’s most rapid growth is occurring outside the U.S.
Companies in the global music industry may be poised to benefit from the growth in global music.
How May Individuals Gain Exposure to Companies in the Global Music Industry?
The MUSQ Global Music Industry ETF (MUSQ)
The MUSQ Global Music Industry ETF (MUSQ) seeks to provide investment results that, before fees and expenses, correspond to the total return performance of the MUSQ Global Music Industry Index (MUSQIX). The MUSQIX Index is designed to provide exposure to global, publicly traded companies and royalty funds with a core business interest in the global music industry.
MUSQ may provide individuals with an attractive vehicle to gain exposure to the global music industry.
[1] Unless otherwise noted, all data sourced from: Global Music Report: 2024, IFPI, March 2024
[2] Peoples, Genn, Why Are IFPI & MIDiA’s 2023 Revenue Figures So Far Apart? The Answer Lies in ‘Expanded Rights.’, Billboard Bulletin, 3/22/24
MUSQ Global Music Industry Index ETF is offered by prospectus. Carefully consider the investment objectives, risks, charges, and expenses. This and other important information can be found in the MUSQ ETF prospectus, which should be read carefully before investing and can be obtained by visiting https://musqetf.com or by calling 1-855- MUSQ-ETF(687-7383).
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