We’re officially two months into the COVID–19 quarantine, and Goldman Sachs is taking a stab at economics. Today, they revealed just how the music industry will do at the end of the decade.
Analysts at GS stated that live music became severely impacted by the postponement and cancellation of events this year. There is a 75% drop in revenue, to be exact. That is big, though there is a silver lining. They predict a strong rebound over the longer-term and estimate that online streaming could grow and reach 1.2 billion users by 2030.
Hmm…with a demand for music content and live events now, do you think things would return to normal once this is all over? Given all the records so far, global music revenues projected to reach $142 billion by the end of the decade. That is an 84% increase compared to 2019.
So, Here’s the Long-Term Growth Outlook
So far, John Hopkins University reports 4.9 million have contracted the virus and 323,333 deaths have occurred worldwide. The global pandemic has shutdown economies and imposed rigorous restrictions for the world’s population. An imminent recession is expected to be worse than the downturn of the Great Depression in the 1930s. With the social distancing and confinement measures for re-opening essential entities, GS thinks listening to music is going to shift. That is, they think it will stray away from streaming to other forms of entertainment but their outlook remains intact. We already have Twitch and live streaming sets. Anything else we can add?
They’ve deemed the beneficiaries of this crisis as the online streaming market, specifically Universal Music Group and Sony Music. Their growth of streaming and improved monetization of music content make it so. Competition likely intensifies with Spotify and the like, while YouTube benefits from the monetization of videos through advertising and subscriptions as well.
The era of entertainment has changed this year, but we eagerly await its return.