Goldman Sachs Revises Music Industry Revenue Forecasts.

July 03, 2023: Goldman Sachs, a well-known financial institution, has released its latest report on the music industry titled “Music in the Air.” This report has gained significant attention in the music industry due to its optimistic forecasts and has influenced investors’ decisions.

In the previous report published in June 2022, Goldman Sachs predicted that the music industry would generate revenues of $94.9 billion in 2023, increasing to $153 billion by 2030. These revenue estimates encompassed recordings, publishing, and live music sectors.

However, in the latest report, Goldman Sachs has slightly revised its predictions. The new forecast suggests that the global music market will be worth $92 billion in 2023, with a projected rise to $151.4 billion by 2030. These figures represent gross revenues. The report also provides estimates for net revenues, which consider the share taken by rightsholders. The net revenue projections are $65.1 billion in 2023 and $104.4 billion in 2030.

Breaking down the revenue predictions 2023, the report anticipates $28.2 billion from recorded music, a decrease from the previous forecast of $30 billion. On the other hand, publishing revenues are expected to reach $8.8 billion, up from the previous projection of $7.8 billion. As for the live music market, Goldman Sachs forecasts it to be worth $28.1 billion in 2023, slightly lower than the previous estimate of $29.1 billion.

Looking ahead to 2030, the report predicts that net revenues will amount to $104.4 billion, with recorded music contributing $50.1 billion, publishing adding $14.7 billion, and the live industry accounting for $39.5 billion.

The report also addresses several other important points, including the challenges the music industry faces. Goldman Sachs highlights the under-monetization of music content, outdated streaming royalty payout structures, and the deployment of Generative AI as significant issues.

To tackle these challenges, Goldman Sachs suggests various solutions. One approach is implementing recurring price increases for streaming subscriptions, similar to other industries like subscription video-on-demand services. The report also emphasizes the potential for increased monetization of superfans, which could generate additional revenue of nearly $2 billion by 2027 and $4 billion by 2030.

Furthermore, the report criticizes the traditional ‘pro rata’ model of streaming payouts, stating that it needs to evolve to cope with the increasing amount of music being released, the rise of streaming manipulation fraud, and the preference of algorithms for lower royalty content.

Regarding Generative AI, Goldman Sachs acknowledges its impact on content creation, music production capabilities, and productivity. However, it stresses the importance of controlling its deployment to protect intellectual property and preserve the user experience. Collaboration between rightsholders and digital service providers is seen as crucial in this regard.

In summary, Goldman Sachs’ latest report on the music industry provides revised revenue forecasts and discusses various challenges and potential solutions. While the report offers valuable insights, it’s essential to consider the context of Goldman Sachs’ relationships with major players in the music industry. Nonetheless, these forecasts and analyses contribute to the ongoing discussion and understanding of the music industry’s future trajectory.

Note: The content provided above is based on information from the internet sources.