Goldman Sachs Highlights Major Markets’ Streaming Slowdown

Despite an ongoing streaming-growth slowdown in established markets, global music industry revenue is on track to top $100 billion during 2024, according to Goldman Sachs’ “Music in the Air” report.

Goldman just recently pointed to insights from its latest analysis of the music space, including revenue from recordings, publishing, live events, and more. We last checked in on Music in the Air data this past May, when a slimmer “redacted” version shed light on a decidedly bullish forecast of almost $164 billion in global industry revenue for 2030.

Now, the investment bank has elaborated on the prediction in a fresh streaming-focused update. Like with past coverage of the annual report, it’s worth reiterating Goldman’s clear-cut financial interest in strong industry growth. At the top level, the business advised BMI on its sale and has stakes in companies including but not limited to Fever, Splice, and Complex.

That should be kept front of mind with regard to the long-optimistic nature of Music in the Air. Similarly important is the well-documented streaming-growth slowdown in leading markets (see the RIAA’s 2024 half-year summary) and the comparatively explosive buildout in emerging industries.

The latter’s been driven home by multiple IFPI reports, Spotify’s quarterly user-geography breakdowns, and, more generally, the major labels’ massive investments in China and Hong Kong, Brazil, and several MENA nations.

At the intersection of the points – reduced revenue improvements in leading markets and double-digit annual growth in quick-rising industries – Goldman’s banking on continued contributions from emerging spaces.

Per the latest Music in the Air analysis, this refers specifically to developing markets’ making “up 70% of new streaming music subscribers by 2030.” Behind the percentage, the resource foresees 48% paid-streaming penetration in established markets by 2030 – UMG has emphasized that it’s also looking for bolstered streaming results in the countries – and 13% in emerging markets.

As things stand, monetization is less lucrative and relatively difficult in these emerging markets, referring both to smaller subscription costs and cheaper advertising rates. (To the growing dismay of the majors, ad-supported listening isn’t particularly lucrative even in the States.)

Following Goldman’s prediction (complete with the above graphic showing single-digit YoY subscriber growth in the U.S., Canada, South Korea, the U.K., and more) to its logical conclusion, however, substantial streaming-revenue expansions are said to be forthcoming on the emerging-markets side.

“Our analysts see an opportunity for pricing in emerging markets to improve as incomes rise,” the document spells out.

Time will tell whether that opportunity materializes – especially given, among other things, stiff competition from regional players as well as the historical difficulty associated with convincing fans to pay for music access.

In any event, Goldman has also reduced its expected streaming compound annual growth rate from 11% to 10% – or identical to Universal Music’s high-end anticipated subscription-revenue CAGR through the 2028 fiscal year.

Certain “lower assumptions for revenue from ads and emerging platforms” prompted Music in the Air’s streaming CAGR reduction, with growth still in the cards from superfan plans, further price increases, AI monetization, and “new payment models for artists,” according to the text.

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