To understand the trends and predictions within the global music venue landscape and how virtual streaming platforms are evolving on account of social distancing measures preventing live concerts, performances, and shows.
The global music industry generated a revenue of $56.74 billion in 2019. The industry has two major income streams: live music and recorded music. With the COVID-19 pandemic and the subsequent social distancing measures preventing live concerts, performances, and shows, and the closure of retail stores causing physical sales of recorded music to fall globally by one-third and digital music by 11%, some interesting trends have emerged in the virtual music streaming landscape. Currently, music streaming contributes 47% of the total music industry revenue, up from only 9% six years earlier. A few trends are briefly described below.
Increasing Live Streaming by Music Venues
Ever since the COVID-19 pandemic and the implementation of social distancing measures, several music venues have turned to live streaming of their events to sustain themselves.
The Seattle based independent music venue Nectar Lounge has performed a series of virtual concerts involving their bands that were live streamed to their followers.
However, the owners of the music venues state that the money coming in from the live streams do not come close to the revenue brought in by food and drinks during live events. As per Mario Abata, the booking manager at Nectar Lounge, even though the live streams are good for the bands, they are not enough to sustain the venues as a whole from a long-term perspective. As per several independent music venues, the future is uncertain.
Musicians Are Finding New Ways of Engaging With Their Fans
Using services like Instagram TV, Twitch, and others, musicians are findings new ways of engaging directly with their fans. They are being supported by streaming platforms that have enabled new monetization methods that allow subscriptions and memberships to the artist channels as well as allow the fans to leave tips for their favorite musicians.
Since March 2020, Austin guitarist Jackie Venson has been using social media to connect with her fans. She performs for three hours each night for an average viewership of 2,000 fans. She places links to her PayPal and Venmo accounts on her livevideo streams and her fans leave her tips.
As per a report released by the major Chinese music company Tencent Music Entertainment, the new monetization methods helped more than 80% of the artists receiving exclusive income incentives to increase their income by over 50%.
Big companies are also developing new ways to enable musicians, venue providers, and music labels to engage with their followers. Vivendi has developed a platform that allows musicians to perform, directly engage with their fans, and share content. Verizon is collaborating with Live Nation Entertainment to enable musicians to organize virtual events and video series.
Increasing Cross-Industry Partnerships to Promote Music
With the rise in digital music consumption, there has been an increase in cross-industry partnerships to promote and distribute music and influence the consumer behavior.
In April 2020, the rapper and producer Travis Scott performed a live concert inside the popular video game Fortnite. Over 27.7 million unique players participated in the event.
Since live streaming leaves the musicians and the rights holders reliant on third-party platforms like Spotify for their compensation, it is likely that musicians and distributors will promote more cross-industry partnerships in the future to engage more audience and get additional revenue.
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