ALL of the Wall St. Bank Are Bullish On Music
In the face of recession, streaming still has wind in its sales.
In a season defined by bad economic news, Spring ended on a high note for anyone sitting on a substantial catalog of music right. Goldman Sachs dropped their annual Music in the Air report, and it remains red hot on the future of music revenues. So much so that the firm increased projected music revenues from an already titillating $45.7bn to a positively orgasmic $53.2bn.
It’s being widely reported that the upward revisions are attributed to “higher-paid streaming ARPU [average revenue per user] and ad-funded streaming assumptions as well as slower declines in physical sales.” Whatever the reason, the rosy outlook gave many folks in our field a reason to feel good (and a couple of miserable sonsabitches incentive to be contrarian).
But if one view is an opinion (even coming from Wall Street’s biggest bank), then two is an agreement. That is why it’s important to point out a second data point, this one coming from, JP Morgan. The #3 firm dug into Apple Music’s opaque performance and came up with its own optimistic prediction that the #2 music service will be bringing $7bn home to Cupertino by 2025, part of the bigger $55bn music pie the bank foresees in three years.
So can we get a quorum from banking’s big three? Morgan Stanley hasn’t mouthed off on music in many years. But bank #2 put its money where its mouth is — buying $100M worth of Warner Music stock last Fall and leading Hipgnosis’ $100M raise in February.
Of course, these moves were made before terms like “attention recession” started spiking in April. And this morning's news that 1M brits canceled their music subscriptions in Q1 made us feel a little queasy while writing this. But if all the big banks agree, while Harry Styles breaks vinyl sales records, then it seems music will remain a solid bet as we ride out this looming downturn.
TAKEAWAYS
Salient statements from this week’s music news.
1. National Music Publishers Association Announces Legal Campaign Against Unlicensed Apps
The industry pitbull is fed up with unlicensed music appearing in apps via sketchy Spotify integrations and other illegitimate means. Apple and Google App Stores have also been implicated.
Takeaway: The NMPA has never lost a copyright infringement lawsuit, Israelite reminded the audience. In effect, the group is telling non-compliant app makers, “You can make a smart decision and get licensed, or shut down,” he said. “We expect to see quick results.”
2. Ikea Launches Long-Awaited Turntable in Collaboration With Swedish House Mafia
Not content with leading pop production and music streaming, the Swedes are now coming for our turntables.
Takeaway: Back in 2018, IKEA first announced plans to release a turntable as part of its FREKVENS collection with Teenage Engineering but that failed to materialize due to manufacturing challenges.
3. Studios Are Rushing to Record Music in Hi-Def Surround Sound
Apple and Amazon’s enthusiasm for new formats is driving artists to demand that studios deliver immersive audio.
Takeaway: In March 2020, according to Dolby, just 30 studios were equipped for mixing in Dolby Atmos, but today the number is nearly 600 — a 1,900% increase.
