J'son & Partners Consulting presents brief results of the market research devoted to the music streaming market in Russia and the world at the end of 2018.

Summary

The subject of this study is music streaming, one of the types of streaming media used for delivery of music. The user receives it from the provider (service) via the Internet using a computer or mobile device.

This research:

1. Analyzes both the Russian and the global music markets. It contains information about the size, structure, main players and development forecasts for the market up to 2021

2. Highlights the segment of music streaming as the main driver of the music industry growth. The study gives the following data for the Russian and world markets (separately)

- Size (revenue and audience), development forecasts

- Structure, by players, as of April 2019

3. Additionally, this research gives the following information about the Russian market of music streaming:

 - Detailed description of the main players. Namely, their:

▪          Service functionality,

▪          Custom rates,

▪          Business models;

- The segment‘s main development trends:

▪          Consumption of audio content,

▪          Devices.

▪          Anti-piracy.

- The authors give their forecast of changes in the market structure for the period up to 2021

4. The study includes a detailed analysis of ecosystems that use audio content in Russia and the world

Music streaming in the world

Streaming is the fastest growing segment and the main driver of growth of the entire music industry during 2014-2018. In the near future it will remain the main way of consumption and monetization of audio content.

J'son & Partners Consulting predicts an increase in music streaming revenues in the world to 14.3 billion dollars in 2021 (CAGR 17%), and the number of paid subscribers will increase to 446 million. Such growth will be supported by some emerging markets (Brazil, Mexico, India, Russia), as well as countries with late adoption of music streaming (for example, Germany and Japan).

The world's largest companies are Spotify (free and premium services) and Apple Music (the first choice of paid services for iOS users). The largest audiences of music streaming services are in the US, China and India. The last two are leaders of the regional market.

Music streaming in Russia

Listening to music online is a stable habit, 61% of Russian Internet users have already tried music streaming services. At the same time, 48% of users listen to music almost daily, and 69% do it three times a week and more often.

The Russian audience has historically been used to paying for music. In 2007, with a result of 401.7 million dollars, the country's music market took the 9th place in the world in terms of revenue. All legal sales were made on physical media (CDS, vinyl records and cassettes).

In 2018, music streaming revenues in Russia amounted to 4.7 billion rubles. J'son and Partners Consulting predicts that the growth potential of music streaming services is still not reached and the market will grow rapidly until 2021. According to the forecast, in 2021 it will reach 18.6 billion rubles (CAGR will be 58%).

In OECD countries there are 7-10 music streaming services. Russia already has 8 players and the market is close to its saturation. The analysis of the market development prospects showed that its structure will change under the influence of the growth of the total number of subscribers and advertising costs, as well as the marketing policy of the existing players.

The main drivers for the further music streaming market growth:

• Russia's first place in the share of streaming users in the total number of music listeners (87%).
• The growth of the available base of mobile devices, which account for 65% of the total consumption of music streaming services in Russia.
• The growth in the number of connected devices, such as smart speakers, and (in the future) connected cars.
• Anti-piracy.
• Tariff increase.
• The music streaming service, included in the ecosystem of large corporations, today does not bring high income and is not a self-sufficient source of profit. At the same time, companies use music to create customer loyalty to the entire ecosystem. Expanding of the offer of media services can be achieved by:
• Independent development.
• Acquisition of start-ups and established companies.
• Cooperation with services on the partner model.

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This information note was prepared by the J'son & Partners Consulting. We work hard to provide factual and prognostic data that fully reflect the situation and available at the time of release. J'son & Partners Consulting reserves the right to revise the data after publication of new official information by individual players.

Copyright © 2019, J'son & Partners Consulting. The media can use the text, graphics and data contained in this market review only using a link to the source of information - J'son & Partners Consulting or with an active link to the JSON.TV portal

™ J'son & Partners [registered trademark] 

Detailed results of the study are presented in the full version of the report

“Global and Russian music streaming market. Results of 2018”

SUMMARY      

METHODOLOGY AND SUBJECT OF THE RESEARCH

1. OVERVIEW OF THE GLOBAL MARKET FOR AUDIO CONTENT

1.1.       SIZE AND STRUCTURE OF THE MUSIC MARKET. FORECAST OF ITS DEVELOPMENT.

1.1.1.         Revenue

1.1.2.         Audience.

1.2.       MAJOR PLAYERS OF THE MUSIC STREAMING MARKET.

1.3.       MUSIC STREAMING DEVELOPMENT TRENDS.

2. THE MARKET FOR MUSIC STREAMING IN RUSSIA

2.1.       HISTORICAL NOTE

2.2.       MARKET SIZE. DEVELOPMENT FORECAST.

2.2.1. Music streaming market revenue

2.2.2.         Music streaming market audience.

2.3.       MAJOR PLAYERS IN THE MUSIC STREAMING MARKET IN RUSSIA.

2.3.1. Service functionality.

2.3.2.         Custom rates.

2.3.3.         Business models.

2.4.       DEVELOPMENT TRENDS.

2.4.1.         Audience consumption of audio content.

2.4.2.         Devices.

2.4.3.         Anti-piracy.

2.5.       FORECAST OF CHANGES IN THE MARKET STRUCTURE.

3. EXAMPLES OF ECOSYSTEMS WITH AUDIO CONTENT IN RUSSIA AND THE WORLD
4. FINDINGS

List of pictures

Pic. 1. Global recorded music industry revenues, 2001-2018, billion dollars

Pic. 2. Market structure of the music industry, 2018, %

Pic. 3. Dynamics of income from streaming in the world, year to year, %

Pic. 4. Penetration of paid music streaming services (top 5 countries and Russia), 2018

Pic. 5. Music streaming revenues in emerging markets, 2018, million dollars

Pic. 6. Music streaming market in the world until 2021. Revenues, billion dollars.

Pic. 7. Top 5 countries by the share of streaming users in the total number of music listeners, %

Pic. 8. Subscribers to paid music streaming in the world, million users

Pic. 9. Shares of music streaming services by number of paid subscribers %, 2018

Pic. 10. Legal markets of music sales on physical and digital media, Russia, million dollars, 2001-2018

Pic. 11. Structure of the Russian legal music market, 2018 and 2021

Pic. 12. Forecast of the Russian music streaming market, billion rubles, 2016-2021

Pic. 13. Forecast of the number of paid music streaming users in Russia, million, 2016-2021

Pic. 14. Duration and devices for listening to music, Russia

Pic. 15. Place of listening to music, Russia

Pic. 16. Frequency of listening to music, Russia

Pic. 17. Smartphone users, world and Russia, %, 2013-2018

Pic. 18. Smartphone market volume in real terms, million pieces

Pic. 19. Smartphone penetration in households, Russia, %

Pic. 20. Sales of tablet PCs and phablets in Russia, million pieces

Pic. 21. Tablet penetration in households, Russia, %

Pic. 22. Market shares of music streaming services by revenues, 2018, %

Pic. 23. Subscription to Yandex.Plus, 2018

Pic. 24. Sberbank Ecosystem

List of tables

Table. 1. Top 10 local music markets, 2018

Table. 2. Comparison of the basic functionality of linear and non-linear music streaming

Table. 3. Characteristics of the main streaming music services in the world, 2019

Table. 4. Comparison of music streaming service packages, 2019

Table. 5. Compatibility of services with platforms and devices

Table. 6. Characteristics of the main streaming music services in Russia, 2018

Table. 7. Functionality of the main streaming music services in Russia, 2019

Table. 8. Tariffs of the main streaming music services in Russia, 2019

Table. 9. Opportunities for interaction of streaming music services in Russia with other applications, 2019