Streaming would have paid off, but now it’s time for record companies to go hungry! Universal Music has confirmed a slowdown in the number of new subscribers on the platforms. And the solutions to get the machine going again are not obvious.
Have music streaming services reached their peak of subscribers? At Spotifythe industry champion’s counter showed 246 million paying customers in the second quarter, a small increase of 3% compared to last year. On the record label side, there has been concern for a while about the apathy of the market, but it is the financial director ofUniversal Music who officially expressed it during the last results of the major.
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New subscribers are not rushing to the door
« Revenue from subscriptions [aux plateformes de streaming] experienced a deceleration in growth “, Boyd Muir said. The ” major partners » what streaming services have been « less efficient ” to recruit new subscribers, he laments. According to Bloombergall platforms are concerned, but particularly Amazon and Apple Music (which unfortunately do not provide any figures).
The streaming sector is not in decline, growth is still there at Spotify or YouTube, even if it is weaker; it’s just that new subscribers are no longer rushing to the platforms’ doors. This is a problem for record labels, who can no longer count on the exponential growth of streaming to improve their books.
Labels have been downsizing and restructuring to maintain profitability, but it won’t be enough in the long run. Companies are looking at other potential revenue streams, like concerts or merchandising, but they ultimately have little power and control in these areas.
The only lever the music industry can really pull is to push streaming services to increase their prices. Spotify does not hold back, but it is mainly to finance other activities (podcasts, audiobooks, etc.) that do not go into the pockets of the majors.
“Superfans” willing to spend more to support their favorite artists could be a very interesting target for labels and platforms alike, but you still need to know what to sell them.
Read Superfans are few in number but they bring in a lot of money for the major record labels
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Bloomberg