Streaming has led to labels to change their businesses and rely more on social media to drive more revenues.Īnother industry that has been negatively affected by the new technology is the traditional AM/FM radio. In this way, last year Universal Music Group managed to generate over $1.0 billion in revenue from streaming, versus $375 million a year earlier.

Due to the fact that streaming services pay lower royalties, music industry is now earning less than a couple of years ago. However, the future seems to look bright as global music spending surged by 41.8% to $4.07 billion in 2015 and is expected to reach $11.06 billion in 2020, according to PwC. Even though the popularity of streaming has increased, it has dragged down the sales of physical albums, as well as the sales of downloaded albums and singles.

Streaming has actually managed to disrupt the music industry and while for users it had a positive effect, for the music industry streaming resulted in a drop of revenue. According to the Recording Industry Association of America (RIAA), industry revenue from paid subscriptions in the US surged to $1.22 billion in 2015 from $800 million a year ago. (NASDAQ: AMZN), and Alphabet Inc (NASDAQ: GOOGL) also jumped in the field, launching their own streaming services. In the last couple of years, tech giants like Apple Inc. One of the leaders in the segment is Spotify, founded in 2008, which allowed users to have access to entire playlists, as well as save songs for offline listening, in exchange for a fee. The pioneers of this segment were internet streaming services, such as Pandora Media Inc (NYSE: P), but over the years more and more companies appeared, which managed to shape the industry. The introduction of online music streaming services revolutionized the way people listen to music making it more accessible and, what’s more important, more portable.

Pandora vs spotify vs apple music