Welcome to Music Enterprise Worldwide’s weekly round-up – the place we ensure you caught the 5 greatest tales to hit our headlines over the previous seven days. MBW’s round-up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximize their earnings and scale back their touring prices.
The enterprise of streaming dominated developments within the music trade this week, with Common Music Group COO and CFO Boyd Muir telling an viewers at a Morgan Stanley convention that we will count on to see the primary of the brand new superfan-oriented ‘Tremendous-Premium‘ subscription tiers seem in 2025.
In the meantime, Amazon Music revealed this week that it’s following in Spotify‘s footsteps and bundling audiobooks (from its Audible service) into its music subscriptions. Nevertheless, in contrast to with Spotify’s bundling, Amazon’s transfer gained’t consequence in decrease mechanical royalty payouts for songwriters.
Following a stellar Q3 earnings report, Spotify‘s inventory value soared to a document excessive, giving the corporate a market cap of $92 billion. Co-founders Daniel Ek and Martin Lorentzon took the chance to money out big-time, promoting a mixed $420 million in shares in November alone.
That windfall bought MBW founder Tim Ingham pondering whether or not it’s time for Common Music Group to promote its stake in Spotify, now value $3 billion.
In a separate column, Ingham famous that, in accordance with Spotify’s Q3 outcomes (and This fall forecast), the corporate expects to submit a USD $1.5 billion annual working revenue on the shut of this yr, and steered that “the long-argued premise that Spotify must claw again margin from songwriters – or certainly any music rightsholder – as a way to survive is now palpably false”.
Lastly, Warner Music Group‘s calendar Q3 earnings, launched this week, confirmed 10.6% YoY progress in subscription streaming revenues.
Boyd Muir, Chief Working Officer and Chief Monetary Officer at Common Music Group, expects “super-premium” subscription tiers to start out showing in 2025 – and he expects that between 20% and 30% of paying music subscribers will finally enroll.
Subsequent yr, “you’ll see the primary of these choices,” Muir advised an viewers at Morgan Stanley’s European Tech, Media and Telecom Convention in Barcelona this week.
“We’re speaking to all of the platforms about what their premium providing would possibly appear to be. They’re all a bit completely different,” Muir added.
“The kinds of issues we’re speaking about are early launch of music, issues like premier occasions round music, issues like chat room[s] between artist and fan, collectibles…”
Spotify’s rival, Amazon Music, has develop into the newest music streaming service to bundle audiobooks with its Premium subscription.
In a problem to Spotify’s audiobook service, Amazon Music Limitless subscribers within the US, UK, and Canada can now pay attention to at least one audiobook a month from Amazon-owned audiobook service Audible. The retail and tech big acquired Audible for $300 million in 2008.
The NMPA has already responded to the information, and the distinction between the group’s response to Amazon Music’s transfer and its response to Spotify’s transfer earlier this yr is putting.
“We count on this new Amazon bundle won’t lower income for songwriters,” NMPA President and CEO David Israelite mentioned. “Not like Spotify, Amazon is music creators as enterprise companions and in search of to have a deal in place earlier than the primary spherical of royalty funds…”
Common Music Group and its buyers have good motive to really feel conflicted about Spotify‘s hockey-stick worth progress in 2024.
In spite of everything, UMG, the world’s largest music rightsholder, was value thrice as a lot as SPOT in market cap phrases as lately as the tip of 2022.
But as issues stand right this moment, in public valuation phrases anyway, Spotify is king of the music enterprise.
Having overtaken UMG’s public valuation this summer time, Spotify – with a $92 billion market cap right this moment – is at the moment value roughly double Common’s valuation on the Amsterdam Euronext…
Who’s bought the larger consumer base: Netflix or Spotify?
Proper now, there’s no contest: it’s Spotify.
In line with its newly-released Q3 outcomes, Daniel Ek‘s inexperienced machine was accessed by 640 million MAUs (month-to-month energetic customers) within the quarter to finish of September.
Netflix’s official consumer base hit 282.7 million ‘members’ in the identical interval. As well as, Netflix lately confirmed it now has 70 million folks signed as much as its ‘ad-supported’ tier, which launched two years in the past.
There have been loads of questions in regards to the progress trajectory of streaming revenues at main music corporations this yr.
Warner Music Group has persistently supplied probably the most optimistic responses.
On November 21, WMG introduced its fiscal This fall (calendar Q3) outcomes. The corporate has posted double-digit YoY recorded subscription streaming progress on a normalized foundation for the fourth quarter in a row.
In calendar Q3 (WMG’s fiscal This fall), the corporate’s subscription streaming revenues grew 10.6% YoY on a normalized fixed forex foundation to $645 million…
MBW’s Weekly Spherical-Up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximise their earnings and scale back their touring prices.Music Enterprise Worldwide
