Even though music never losses it mass appeal, the way we are consuming tunes is changing – and this is having an effect on the market. Juniper Research has just released a new report which says that the digital music industry is going to be seeing some slower industry growth over the next five years but will still see the market’s total worth top $13 billion by the end of 2019. The reason why the growth will be slowed from the current $12.3 billion is because revenues from so called “legacy” streams like ringtones and ringback tones are going to drop rather quickly.
On top of those numbers, the report also found that people will continue to move to a cloud-based format at a rather brisk pace. This move means that streaming music services that are described as “pure-play” like Spotify and Pandora are going to face increased competition from rival services that are still trying to get off the ground these days like Apple and Google.
For its part, Google has made some attempts to strengthen its standing in the streaming music service by buying up smaller and weaker competitors like Songza. By absorbing these services, the company is making itself a power in the industry who is able to get new technologies from the smaller firms.
One area of revenue leakage that even companies like Google are going to have to be wary of in the coming years is piracy. While the music industry has changed from the format that was best known when online piracy became a real threat, pirates are changing and adapting as well. Countries like China are only making piracy worse, because the government tacitly approves of pirate’s actions by only requiring a small amount of digital content be licensed.
Juniper says in its reports that smartphones and tablets are going to be the main platforms for digital music by the time the end of the decade rolls around. The company did add the caveat that digital music on the PC and laptops will still remain strong through this period.
Edited by Stefania Viscusi