This July EMI’s Insight division launched an unprecedented initiative to share data from their 850,000 interview Global Consumer Insight data. This dataset covers 25 countries and over 7,400 artists, with twelve people being interviewed at any given moment, 24 hours a day, 7 days a week.
The data is being shared with the data science community in a range of initiatives including forthcoming Music Data Science Hackcamps.
As hard data continues to be something of a scarce commodity for the streaming music debate I decided to mine EMI’s dataset to create a snapshot of global streaming music adoption, and its influence on the broader music market. I have written up a report which you can download for free here. Additionally EMI have given me permission to post the data here so that you can play around the data yourselves. In fact I invite you to go and play around with the data and see if you can find any trends that I missed in my analysis.
Here are some of the key findings from the report (which of course, along with all of the opinions and interpretations are my own and are not, necessarily, EMI’s)
- Streaming has a firm foothold. 32% of consumers across the globe are now using streaming services (see figure 1). However, adoption is far from uniform.
- Nordics lead the way. Norway and Sweden (the home of Spotify) are respectively the 1st and 3rd most active streaming markets globally. Key to this trend is the relative sophistication of Internet users in these markets. 48% of Norwegians are now streaming music users, as are 43% of Swedes.
- Streaming is a good fit for piracy riddled Spain. Spain is the 2nd most active market with 44% streaming penetration. But whereas consumer sophistication was key to Nordic adoption, in Spain piracy and the legacy of free were the most important drivers.
- Free is a good fit for France too. The role of piracy and free have also been important in France. French authorities have pushed through the controversial Hadopi legislation but the carrot of Spotify and local streaming success Deezer has delivered immediate results. Translating streaming usage into purchases though is less successful: just 13%.
- Purchase conversion rates are higher in lower penetration markets. The US, Canada, UK, Germany and Denmark have lower streaming penetration but these markets have much higher streaming-to-paid downloads conversion rates, averaging 23% of streaming users.
- Streaming Drives Music Discovery and Consumption. Although it is still too early to draw definitive conclusions about exactly how much streaming impacts piracy and sales, the case for driving discovery and consumption is much clearer. 55% of global streaming music users state that they now discover new artists and new music as a result of streaming.
- Usage is steady among existing users. Usage among existing streaming users is broadly steady with 19% using streaming more than 12 months previously and 20% more.
Download the complete report here.
Music Industry Blog 
The key distinction that i think is missing is the difference between streaming and on demand streaming. Regular streaming, like a controlled form of radio, can be great for artists. Sites like Pandora and Earbits lead to music discovery and hopefully purchases. Sites like Spotify do not, people there listen mainly to music and albums they already know or own. There is less discovery and to the extent there is discovery it doesnt lead to a purchase outside of continued “renting” of the music from Spotify’s corporate overlords.
Yes agree entirely for the need for distinction, FYI the definition used in this report is:
“For the purposes of this report streaming refers to all streaming audio activity, free and paid. It also refers to both fully on-demand streaming and non-interactive streaming.”
However I don’t think that on demand services need necessarily just be about listening to existing music collections. This is where the role of discovery app within the streaming services should really come to the fore.
There is also an argument that personalized radio stations can cannibalize purchases from the more passive music fans who on average only buy and album or two a year.
On the other side of the equation, 20% of streamers do buy music downloads by artists they have discovered on streaming services such as Spotify.
Some good points but two things id add. As an indie label owner im not too concerned with the “passive fan” that only buys two cds a year anyway. They wouldnt buy from us anyway. As far as in app discovery engines for on demand streamers, thats great, but from the user persepective they feel they are already paying so buying again outside of the service would feel like paying twice to many. Id also assume anything discovered could simply be added to a cue of some sort for more on demand streaming. Bottom line is, if a service pays out low rates as spotify does it should push to a real purchase or shouldnt be on demand. Unfortunately Spotify is becoming another tool for the major labels and tech industry outsiders to profit off art while bypassing the artists.
I’m unable to download the Excel file. Looks like a dead link.
Hi Glenn: I just tried the excel link and it worked for me. What browser are you using? In Chrome it downloads to the bottom of the screen rather than opening as a page.
Mark
The top 4 happen to be the countries were Spotify started some 4 years ago. One striking exception though: The UK. Why does the UK stays this far behind? Anyone?
Is there demographic info available in terms of age groups and/or genres that make up the bulk of the listening experience or at represent a graphic of the streaming market?
A strategy for music industry to strongly consider: stop selling physical cds. This could curtail illegal downloads of new music since high quality MP3s would be much harder to make and the core issue of incredible supply at a zero price point could be addressed. Of course, this strategy would entail a sacrifice since physical CDs make up a large portion of revenues for the big 4 music cos. However, by partnering with/ creating convenient platforms to transition CD buyers to digital conveniently, the short term negative impact may be mitigated. At the same time, a portion of the illegal downloaders would likely transition to sanctioned (i.e. revenue-generating) content as well. Although there would be a short term hit, by removing a major source of illegal MP3s, the industry’s financial viability could be restored.
-Yemi
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Mark, can you define the “buy downloads” in your “20% user buy more downloads..”?
It seems that the report refers to some data that is not in the XLSX, such as purchase behaviour (aka, conversions).
Also seems like there’s a causation issue in there as well. Perhaps people are simply more likely to be “buyers” in these low-penetration countries, leading to what appears to be a greater conversion rate (even though streaming is not doing the converting) when it may simply be the reason for the lesser relative demand for streaming.
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David – there is indeed a cause and effect issue which I would argue is impossible to delineate definitively. With a market as young as the digital music market there is always going to be a degree of new adoption trends being skewed by the unique behaviours of highly engaged tech savvy aficionados. At a market level it is fair to say that streaming has been most successful where the physical market has already tanked. (This spotidj is a key factor in why streaming hasn’t rocketed in the UK – there’s still a reasonably robust physical sector).
The other factor which I didn’t include in this report but will cover soon in a forthcoming post is that interplay between physical, a la carte and subscription. A strong physical market tends to also be a strong download market (it is a more natural usage transition). So we need to be cautious about predicting to what degree advanced streaming trends in the Nordics will translate to markets such as the UK and US.
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Mark, You say that ‘32% of [music] consumers across the globe are now using streaming services’, however, I think you mean to say that of the countries sampled, the average penetration is 32%, which is something quite different.
By way of example, imagine that instead of nine countries, you had data for three countries: A at 10%, B at 30% and C at 45%. By your calculation, this gives an average of 28% [= (10 + 3 0 + 44)/3]. Let’s say that country A had 20 million consumers, B had 2 million and C had 1 million. Intuition will tell you that the average for ALL consumers is much closer to 10%. (In fact, it’s around 11.3%). So while you could say that on average these countries have 28% of consumers using streaming services, you can’t say that 28% of all consumers use streaming services.
And can you in fairness use the term ‘across the globe’ when you use only nine countries in your analysis? This can hardly be regarded as a representative sample.
…an interesting analysis nevertheless.
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