According to a new report published by MIDiA Research on 18 March, the growth was driven by “a strategic shift towards superfan engagement as indicated by expanded rights and a resurgence for physical music in 2023, with revenues climbing by 4.6%.”
MIDiA estimates that streaming grew 9.6% YoY to $21.9bn in 2023, although it lagged total market growth for the first time, with its share of total recorded music revenues falling slightly to 62.5%.
“2023 was the year in which the industry settled back into a positive growth trajectory after the volatility of the pandemic and post-pandemic years,” MIDiA said. “But the numbers also point to a market that is embarking on a major period of change.
“This growth, which outpaced the 7.1% increase seen in 2022, means that the market is now more than double (124.5%) the size it was in 2015. The growth highlights the industry’s resilience and adaptability, but the changing mix of revenues points to an industry on the cusp of transformational change.”
MIDiA added that physical had emerged as the industry kingmaker. “So far in this decade, each of the two years that physical revenues grew, industry revenue growth was strong, and in the two years physical fell, industry growth was slow. Physical success is the difference between good and great,” it said.
The report indicates that Universal Music Group is still the biggest label at 28.3% market share, with revenues totalling $10bn, while Sony Music Group emerged as the fastest growing major label with revenues rising by 11.6%. Sony’s market share rose by 0.3 points to 20.3%.
Non-major labels grew revenues by 13% in 2023, compared to 9% for the major labels, meaning that non-major label market share was up for a fourth consecutive year, reaching 31.5%.
“Last year was very positive, and it may prove to be the one we look back upon as ‘when things started to change’,” MIDiA managing director Mark Mulligan said. “Streaming growth slowed, on the recordings side of the equation, at least.
“Monetising fandom became a serious part of the industry, while non-majors locked into long-term market share growth. Self-releasing artists also started to see a clear divergence between what they streamed and what they earned.
“The industry is beginning to bifurcate between the traditional, streaming-focused business, and a new one in which fandom and creation will take centre stage. Welcome to the first year of tomorrow’s music business.”
MIDiA’s report arrives a few days before global recorded music body the International Federation of the Phonographic Industry publishes its annual Global Music Report, which will also include data on the global recorded music market for last year.
