The music and streaming in France, a revolution !

The death of the CD and piracy heralded the disappearance of the recorded music market. How did the advent of streaming has changed the game ?

For the first time in France, in 2018 digital media generated a higher turnover than physical media. CDs and vinyls are far from having disappeared, but it is indeed the rise of the major on-demand listening platforms that is giving new color to the recorded music market.

The digital era does not, however, signal a return to the heyday of the CD. In 2018, music sales for all media combined were not even half of what they were in the early 2000s. The overwhelming weight of certain platforms is a new constraint for producers, while the threat of piracy has not disappeared.

Free streaming, without subscription, is not a sustainable business model. The case of YouTube reveals the great appetite of consumers, especially young people, for music content. More than a third of YouTube users do not watch the images and only use it as a listening platform. Today, YouTube is by far the leading online music listening platform in terms of number of users. It accounts for about 50% of the time spent listening to music online, but only 10% of streaming revenues. And in absolute terms, it's 33 million euros in France in 2018, less than the 48 million euros from vinyl sales. Worldwide, a Spotify user generates an average of 18 dollars a year for the industry, while a YouTube user brings in just one dollar.

In the first quarter of 2020, the music industry generated revenues of 290 million euros, according to figures from Snep, the main producers' union. Of this total, digital accounted for 192 million, including 187 million for streaming alone. About two-thirds of total revenues - colossal.

Especially since the trend is still towards a decline in physical sales and a strong increase in streaming consumption

"Audio streaming subscriptions are now the major source of value creation in our market. However, France still has less than 6 million subscribers and there is still considerable room for improvement to transform this new-found growth into a sustainable model," says Snep's CEO.

Of this total, four audio platforms share the market: Deezer (37.5%), Spotify (25.2%), Apple (13.4%) and Napster (7.1%).

This is all the more impressive given that the creation of these platforms is relatively recent: 2007 for Deezer, 2006 for Spotify (world leader, but second in France).

Concerts also now play a major role in the music economy. What does this change for record companies?

These two markets are separate. While some record producers are also involved in the production of shows, not all players are. A company like Sony Music has a live performance production business, but it does not have the same weight in this area as it does in recorded music. For the artists, the concerts could be a form of compensation, for the record companies much less.

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