Whether you’re investing, operating, or earning from music copyright, it’s crucial to understand its value and the trends driving its growth. Spotify’s former Chief Economist Will Page’s latest annual report not only reveals that the music copyright market reached $45.5 billion in revenues in 2023, but it forecasts that revenues could reach $50 billion (doubling their value since 2014) already by next year.
At ANote Music, we ensure that understanding the overall picture gets easier not only for industry insiders but also for those exploring music as an asset class. As the market continues to grow and evolve, platforms like ours allow everyone to earn royalties and get exposure to the growing opportunities in the global music industry.
Read this article to learn about the key trends behind this growth and how you can benefit from them on our platform.
The global income of music copyrights has almost doubled in a decade
According to Will Page’s calculations, in 2023, the global revenues generated from music copyrights reached $45.5 billion. This represents an 11% increase over the previous year and a 26% rise compared to the pandemic-affected 2021. Comparing this year's performance with that of 10 years ago reveals even more significant growth: Will Page forecasts that by the end of 2024, revenues from music copyrights might reach $50 billion, effectively doubling the $25 billion in revenues generated in 2014.
What were the main sources of revenues from music copyrights? This year's figures include:
- $28.5 billion from recorded music revenues: This includes income generated from the sale and streaming of recorded music. It covers digital downloads, physical sales like CDs and vinyl, revenue from streaming platforms such as Spotify and Apple Music, and use of recorded music by broadcasters and public venues.
- $12.9 billion in collective management organization (CMO) royalties collected: CMOs collect royalties on behalf of songwriters, composers and publishers when their music is played publicly. This encompasses royalties from streaming, radio broadcasts, live performances, television, and use in public venues like restaurants and shops.
- $4.2 billion in direct publisher income: This refers to earnings that music publishers receive directly from licensing agreements, without passing through a CMO. It includes synchronisation licenses for music used in films, TV shows, and advertisements, as well as direct deals with streaming services and other platforms. These agreements often allow publishers to negotiate specific terms and ensure faster payments compared to collective systems.
Figure 1: Global revenues of music copyrights (2021-2023)
Source: IFPI Global Music Report, CISAC Global Collections Report, Music & Copyright and Will Page
Recorded music revenues experienced the fastest growth in 2023, with revenues increasing by 12%, followed by CMOs collected revenues at 11%, while direct publisher income grew at a more modest pace of 4%. Notably, CMO royalty collections have rebounded by nearly 40% since the pandemic, with this year’s steadier 11% growth indicating a return to a more steady expansion.
Revenue distribution between master and publishing/songwriting royalties has remained consistent:
- 63% allocated to artists and labels
- 37% to songwriters, publishers, and CMOs.
Record labels’ growth was primarily driven by streaming, which increased by 10.4%. However, notably, physical sales outpaced streaming’s percentage growth, with a 13.4% increase from last year, and particularly strong vinyl sales growth of 15.4% in a year.
While some might view this as a temporary phenomenon, the data suggests otherwise. Vinyl is projected to generate $1 billion in the U.S. alone by 2024, supported by the emergence of new global suppliers and ramped-up production capacity from manufacturers to meet surging demand.
How to benefit from this growth from the early stages
The picture emerging from Will Page’s analysis is promising, but it's worth noting that the $45 billion figure might actually underestimate the true global income generated from music copyrights for several reasons:
- Discrepancies in estimates: Other respected consultancy firms estimate global recorded music revenues to be higher than those reported by IFPI, due to the inclusion of additional sectors like the self-releasing artists segment.
- Lack of global data: Reports like IFPI's cover only 56 out of 193 countries, often grouping diverse regions such as MENA (Middle East and North Africa) together, despite their distinct market characteristics. Furthermore, over 40 countries lack their own collective management organizations, leading to gaps in tracking and valuation.
As emerging markets develop and receive more attention, they will add substantial value to the global music copyrights market, increasing the global value even further and unlocking new opportunities for creators and investors worldwide. Understanding these dynamics can help stakeholders make more informed decisions about engaging with the evolving music industry landscape.
