89 Percent of All Digital Music Revenues Come from Streaming… In Sweden

Sweden is about the size of California.

Its population is roughly that of North Carolina. So the question is whether Sweden represents a unique music market way over there, or a first mover that predicts the future for the rest of the world.

And, if Sweden is what the world looks like tomorrow, is that good for the music industry?  Or, a huge problem for anyone that isn’t a huge label, huge stakeholder, or fan?

The latest stats from Swedish recording group GLC tell quite a story.  Most notably, the group found that streaming revenues now account for 89 percent of total digital music revenues in the country, a ratio that will become increasingy lopsided over time.  By comparison, analyst Mark Mulligan found streaming penetration rates in countries (and largest music markets) like the US, UK, and Japan to be significantly lower.

On one level, that means that downloads are an increasingly unimportant source of revenue for Swedish labels and artists (and, Norwegian artists, among other earlier adopters).  More accurately, it means that paid downloads are less important in the broader legitimate mix, as a separate study from Lund University shows a continued increase in file-sharing activity in the region.

Overall, streaming pulled revenues of 253 million kronor ($36 million) for the first half, against broader recording revenues of 446 million kronor ($63.5 million).  This isn’t a difficult trend to analyze.

9 Responses

  1. @mattadownes

    I lived over in Sweden for 6 months a couple years ago when Spotify was peaking. Not one of the musicians I knew was “paying” for Spotify service, they were all using the free version. If they wanted a song or album (that wasn’t available on Spotify) they’d use YouTube. The loyalty was in the “free” not Spotify.

    • HansH

      If even musicians aren’t paying for music….

      The loyalty to free sure brings in a lot of money 🙂

      • Digitalism

        Seriously, you talked about “digital news” using an example from “a couple of years ago”?

        A couple of years ago there was no Andoriod, and Facebook was smaller than MySpace.

        Change, is possible.

    • Visitor

      …and the national total revenue for music all music sales is $6.66… in Sweden

  2. Nu Profile Entertainment

    I think that what is going to happen and what we have already seen happen thus far is a requirement of not only the music industry execs but the artists themselves to be more creative and cutting edge about the way that they market music to the public and also where the revenue streams will come from. But as stated in this article Sweden is not exactly the pulse of the world so it remains to be seen how the rest of the world will fall in line as far as digital revenue is concerned.

  3. Misan

    Source on this study from Lund University on file-sharing?

    I can promise you that almost all file-sharing going on here is movies, tv-series etc. Spotify has single-handedly eliminated music piracy here on a broad scale

  4. @wheresalexb

    I’m Swedish aswell, and I agree with Misan. I have a few friends who still rely on piratebay and other bit-torrent sites for music, but it seems most people have come to consider Spotify a lot more convenient, and I think it might just be a matter of time before music piracy is eliminated here. Spotify was launched in 2008 already, and with digital downloads not doing very well here, there was a huge market to be seized. That in combination with the low price and the huge catalog made it a viable alternative for many, I think.