IFPI report reveals power of YouTube

IFPI report reveals power of YouTube

The IFPI’s latest Music Consumer Insight Report makes interesting reading for anyone who cares about the global streaming landscape (that would be the entire music industry).

Covering 20 of the world’s largest markets, the report looks at how consumers aged 16-64 engage with recorded music. The good news for the biz is that music is an integral part of our lives: the report found that average listening hits 17.8 hours per week. The car is the most popular listening location, which suggests there’s still a huge opportunity for streaming on the road.

Streaming is now everywhere with 86% of people listening via on-demand streaming. For audio streaming, the global average is 61%; the UK (56%) lags behind Sweden (74%), the US (68%) and Spain (63%), which suggests there’s still plenty of room for growth as more companies enter the British streaming business. Japan (23%), Netherlands (49%) and Germany (50%) all have ground to make up when it comes to streaming.

The 16-24 age group are the most engaged in streaming, with 57% using a subscription service. 

Music continues to be embraced across formats, genres and technologies

Frances Moore

But what’s striking about the IFPI report is the power of YouTube. Video streaming makes up 52% of on-demand music streaming time, of which the vast majority is YouTube - the Google-owned giant accounts for 47% of time spent listening to on-demand music.

However, estimated annual revenue per user is less than $1 from YouTube compared to $20 for Spotify. The report found that 35% of those questioned said the availability of music on YouTube was the main reason not to take out a streaming subscription.

While the biz has railed against the so-called ‘value gap’ from video upload content to YouTube - and secured a big win with the EU Copyright Directive - the video platform is clearly an important one for the streaming age. In his BBC Radio 4 Media Show interview last week, Sony Music CEO Rob Stringer was measured in his comments about YouTube and welcomed their new premium subscription service.

For the remainder of on-demand music streaming, 28% is on paid audio platforms and 20% is on free ad-funded services. Label execs at the IFPI’s Global Music Report earlier this year seemed to agree that subscription revenues were going to be the driver of growth, though Spotify has actually refocused on its ad-funded platform and sales are growing

Smart speakers are also on the rise - 15% of consumers globally are like to buy a device in the next 12 months. 

The report also found that radio is resilient, with 86% of consumers listening and 25% of overall listening time coming from radio.

Piracy has not gone away, according to the IFPI, with 38% consuming music through copyright infringement. 

Frances Moore, chief executive, IFPI, said: “This year’s Music Consumer Insight Report tells the story of how recorded music is woven into the lives of fans around the world. As it becomes increasingly accessible, it continues to be embraced across formats, genres and technologies.

“Record companies are working with their partners to sustain and develop these rich and diverse ways in which music is being enjoyed, ensuring that it continues on its exciting journey around the world.

“However, this report also shows the challenges the music community continues to face – both in the form of the evolving threat of digital copyright infringement as well as in the failure to achieve fair compensation from some user-upload services. Policymakers around the globe have been scrutinising these issues and increasingly acting to address them.”

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