Published
Wed, Apr 24, 2024, 17:45
- Live events and the South African market were key drivers but concerns about artist breakthrough are widespread.
The global electronic music business went from strength to strength in 2023 as total revenues jumped 17 percent year-on-year, the latest IMS Business Report shows.
That values the industry at $11.8 billion, up from $10.1 billion in 2022 and $7.5 billion in 2021. Festivals and clubs continued to dominate revenues, accounting for nearly half of the industry total, while music hardware and software were the second-biggest segment. Global dance music "is now firmly in its post-pandemic growth phase," said the report, authored by MIDiA Research for the International Music Summit (IMS) and out today, April 24th.
As a genre, electronic music had the smallest fanbase out of rock, Latin and hip-hop but it grew the fastest on streaming and social media platforms in terms of reach and engagement. On TikTok, global views for the #ElectronicMusic hashtag hit 10.5 billion in 2023, more than double from 2022. On SoundCloud, one of three tracks uploaded on the platform last year was electronic.
Live events lead the way
Pulling revenue stats from 15 major music companies across labels, publishers, the live sector and DSPs, the report found that live music companies had the strongest revenue growth (35 percent) in 2023. Still, last year's highest earner was labels, which bought in $25.4 billion (versus $23.4 in 2022), whereas live companies earned $25.1 billion (versus $18.7 billion in 2022).
"With streaming an increasingly commodified and convenient experience, the contrast with the vibrant, fan-fuelled live experience is becoming ever more pronounced," the report stated.
Streaming and recorded music
The global recorded music market also finished strong in 2023, with the sector worth $35.1 billion, up from $31.9 billion in 2022. Among record labels, non-majors grew the fastest, with revenues of publicly traded non-majors spiking 17 percent compared to seven percent for major labels. Self-releasing artists lost market share, "feeling the early impact of changes to streaming royalties."
Streaming remains the key driver of recorded music, accounting for $21.9 billion alone last year. But overall growth was outpaced by licensing and expanded rights. "Coupled with a return to growth for physical, this points to a shift from monetising streams to monetising fans," the report said.
Spotify remained the largest DSP, increasing its global market share, but still made up less than a third of the entire DSP market. Tencent Music, Apple Music and Amazon Music were the next largest providers.
South Africa in focus
Germany, the US, Australia, the UK and Brazil were the five markets with the most monthly electronic music listeners on Spotify. South Africa, though, has nearly twice as many electronic listeners as people, which "reflect the degree to which South Africa has built its own electronic scenes and culture," the report said.
While techno and house genres still dominate Beatport sales, Afro house is on the rise—it went from 18th in early 2022 to a high of 9th by late 2023. "This, coupled with the rise of South Africa as a leading Spotify market for electronic music, further points to the rising importance of sub-Saharan Africa in electronic music culture," the report noted.
"Mexico, India and Brazil represent the newer wave of global electronic music markets, but listener numbers are smaller than total population, indicating electronic music culture is still securing a foothold," the report added.
Key headwinds
Gender equity remained a problematic issue in 2023. According to one survey, around 37 percent of people who identified as gender expansive and 33 percent of women said they were passed over for key opportunities. Moreover, 35 percent of the gender-expansive respondents said their career experience had been questioned.
In a separate survey conducted by IMS and AFEM about industry confidence, most people said they were most concerned about artist cut-through and development. This "highlights the increasingly competitive nature of the music business as evermore artists are chasing the same audience," the report said. "On the DJ side, this means more DJs competing for slots. On the events side, it means more competition for the best DJs."
Elsewhere in the DJ world, 40 percent of respondents in a MIDiA survey said DJ gigs generally paid less in 2023, while 41 percent said it's harder to get gigs. A whopping 85 percent believed making music was more important than DJing but 51 percent said DJing remains a bigger source of income than royalties.
Read the full report.
