“The simple truth is that there are no facts about the future,” wrote Midia Research boss Mark Mulligan in his latest blog post.
It’s a refreshingly honest reminder that all analyst forecasts are essentially guesses (“a structured, numerical representation of analyst thinking,” is how he puts it) with more or less rigour behind them.
This isn’t just navel-gazing for the sake of it: it’s an introduction to the news that Midia has just published its forecasts for the music industry’s growth in the next few years to 2030.
The headline figures: it expects global recorded music trade revenues to grow by 51% to $42.4bn by the end of this decade, with retail spending growing to $87.1bn. Midia also reckons that by 2030 there will be 1.1 billion paid music subscribers worldwide.
The obvious comparison here is to the recent estimates published by Goldman Sachs, which are a bit higher than Midia’s forecasts. It predicted $50.1bn of recorded-music trade revenues in 2030 and 1.2 billion paid subscribers.
(“We do not aspire to be cheerleaders for any market,” wrote Mulligan, in a jab in the direction of that report followed by an uppercut criticism of “overly-bullish forecasts that have the benefit of aiding ulterior business objectives” later in the post. Fans of big-stat beefs may also enjoy his needling of the IFPI over currency calculations and growth rates.)
The most interesting part of Midia’s forecasts is where it teases out the nuances in global growth of subscribers versus revenues, and what that might mean for the biggest western music companies.
“By 2030, there will be 1.1 billion subscribers, up from 663 million in 2022, but Asia Pacific, Latin America and Rest of World will account for four fifths of that growth,” wrote Mulligan.
“Crucially, most Western rightsholders have relatively low repertoire share in much of these regions, so they will not benefit from this next wave of subscriber growth in the same way they did in the first, largely Western, wave.”
But wait, that’s not the whole story.
“Europe and North America will account for more than half of the global subscriptions revenue growth, due to higher ARPU and average subscriber months (a result of slower growth). Which means that Western rightsholders will accrue most revenue upside, despite losing out on audience growth.”
But remember, forecasts aren’t facts, and not just because they can turn out to be wrong. They can spark action from companies who want to reshape this possible future.
For example, western rightsholders may work harder to grow their repertoire share in the high-potential regions, but equally, companies from those parts of the world will be pressing to take a bigger share of streams (and thus revenues) in the mature subscription markets.
For all their differences, the message coming out of both the Midia Research and Goldman Sachs forecasts is that there is health potential growth in the next seven years.
That should put a fire in the belly of the music industry, but also of campaigners determined to ensure this growth is shared fairly with musicians.
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