Music streaming revenue surges amid rocky times

In the United States, a report from TD Cowen released in early April 2024 highlights the increasing profitability of music as an investment during challenging economic periods. The data shows a remarkable 12% year-on-year increase in music streaming revenue anticipated for 2024, with projections suggesting the upward trend will persist for at least the next two years. This surge in music consumption is believed to be driven by listeners seeking solace through music amidst the chaos of current events, with many turning to nostalgic and feel-good classics. Notably, the sales of iconic music catalogues have reached unprecedented heights, as evidenced by Bob Dylan's 2020 sale of his music publishing catalog for over $300 million and Bruce Springsteen's recent 2021 sale that exceeded $550 million. Observers in the industry speculate that we have yet to see the peak in catalog sales, indicating a strong demand for established music assets that provide predictable revenue streams compared to newer releases. This market dynamic has led to the realization among artists and music creators that selling their catalogs can be a sensible move. Despite the dominance of newer releases within streaming metrics—approximately 80% stem from post-2010 music—the trend shows that older catalogues are still invaluable assets for music buyers. The generational interest in long-lasting classics has intensified, which drives competition for catalogs of legendary artists. Jeff Biederman, a music business attorney, emphasized the growing appetite for these older songs as people seek an escape from the relentless cycle of negative news. Recognizing this trend, Kobalt Music CEO Laurent Hubert supports investments in older repertoires while exploring established catalogs from recent musicians for potential growth opportunities. Furthermore, a 2024 report by Luminate showed that music streaming exhibits strong resilience despite external pressures such as tariffs that usually affect various goods. The data illustrates that traditional music business strategies may need to be reevaluated, as evidenced by the catastrophic decline of newly released tracks' streaming figures—only accounting for a mere five percent of total streams in 2022. This disparity has raised questions about the viability of new music and whether it can achieve commercial success similar to its predecessors, a dilemma the industry continues to grapple with.