Spotify to Hold 32% of 29-Mil. Music Streaming Subscribers Forecasted for End-2013, According to ABI Research

  Spotify to Hold 32% of 29-Mil. Music Streaming Subscribers Forecasted for
  End-2013, According to ABI Research

Business Wire

LONDON -- August 1, 2013

Consumers paying for on-demand music streaming services will total 29 million
worldwide at the end of 2013, show the latest forecasts from ABI Research.
Accounting for 32% of the premium subscribers, Spotify is expected to close
the year as the leader, trailed by Deezer, SK Telecom’s MelOn, and rounded out
by Rhapsody and Sony. The subscriber base is forecasted to reach 191 million
by end-2018.

Senior analyst Aapo Markkanen comments, “The past two years have seen a
remarkable international expansion of streaming as a distribution model, but
in terms of its long-term potential we’re still only scratching the surface.”

Markkanen continues, “That’s also something to stress when discussing
streaming’s role as a source of artist income. At end-2013 the cumulative
revenue from premium subscriptions will amount to less than $5 billion, yet we
expect this all-time pot to exceed $46 billion in the next five years. Some
two-thirds of it will be going to the rightholders; although how they will
split it is then a whole another matter.”

As regards the streaming providers’ competitive landscape, ABI Research
anticipates some level of consolidation to take place once the current land
grab stage starts slowing down. Streaming is a high-volume, low-margin
industry, so to become and stay profitable the providers need scale. Further
competitive pressure will come from the consumer technology giants investing
in cloud music.

Practice director Dan Shey explains, “Google’s and especially Apple’s moves in
this space have been cautious, for a number of strategic reasons. Microsoft
and Sony have been bolder, mainly because of their involvement in gaming
consoles. Sony, in particular, makes an interesting case with its future cloud
strategy. Obviously threatened by its position as a pure-play hardware firm,
Sony could use the cloud as the fabric for its own services ecosystem.”

These findings are from ABI Research’s “Cloud Music Services” study, which is
part of the firm’sCloud Content and ServicesResearch Service

ABI Research provides in-depth analysis and quantitative forecasting of trends
in global connectivity and other emerging technologies. From offices in North
America, Europe and Asia, ABI Research’s worldwide team of experts advises
thousands of decision makers through 70+ research and advisory services. Est.
1990. For more information visit, or call +1.516.624.2500.


ABI Research
Christine Gallen, Tel: +44.203.326.0142
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