The U.S. Music Industry Grew to Record Levels in 2023
More people spent more on music in 2023 than ever before, according to the 2023 version of the MusicWatch Annual Study.[1] In this blog, we note some of the main highlights from this year’s report.
More Listeners Spending More Money
The U.S. recorded music industry added 10 million new buyers in 2023. A record 91% of the internet population of people 13 years old and up purchased some form of music last year. This includes streaming services, CDs, vinyl records and digital downloads.
Spending on recorded music increased 7% during 2023, driven primarily by expenditures on streaming subscriptions, vinyl records, and CDs.
Additionally, the number of paid music subscribers reached a record 109 million. That rises to 136 million if Sirius XM and Amazon Prime music listeners are included.
Can Subscription Growth Increase
While seven out of ten Millennials pay for subscription streaming services, older groups have not embraced paid services as readily. There is still the opportunity to convert Gen-Z and older listeners to paid services.
Anyplace, Anytime
The top reason for music streaming is the ability to listen to music anyplace, anytime.
Yes, People Still Listen to the Radio
Radio gained listeners in 2023 and was the number one in-car listening option. Nearly 69% of people listen to the radio in their car.
Can Superfans Become Super Spenders
Around 20% of music listeners consider themselves superfans, yet only 9% purchased a VIP package created by artists, suggesting an opportunity to close the gap between fanship and revenue generation. On the plus side, half of super fans are super spenders, buying CDs, vinyl, merchandise, and tickets to live events.
Additional highlights include:
- Hip-hop turned 50 and passed Classic Rock as America’s favorite music genre
- 80% of streamers listen to audio categories other than music, including comedy, current events, and podcasts
- Nearly nine out of ten vinyl buyers plan to buy either the same amount or more records in 2024
- Streamers are interested in additional capabilities, including artificial intelligence (AI), gaming integration, and real-time live streams
A Potential Investment Opportunity
The growth in the US music industry may benefit companies involved in the music industry.
How may individuals gain exposure to companies in the 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 music industry.
For a full listing of MUSQ holdings, please click here.
[1] All data sourced from: MusicWatch Report Results of 2023 Annual Music Study: Record Numbers of Music Streamers and Paid Subscribers, MusicWatch, 3/11/24
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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There is no guarantee the Fund will achieve its stated objectives.
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Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume.
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