Paid music streaming subscriptions like Spotify Premium and Apple Music have finally surpassed Netflix subscriptions.
According to a new report by respected music business analyst Midia, music streaming subscriptions have finally passed 100 million. Spotify took the lead with 43 million paid subscriptions, and Apple Music in a cool second place with 20.9 million. Deezer, Napster, and Tidal took the last slots at 6.9, 4.5, and 1 million respectively.
Apple and Spotify accounted for 64% of the entire subscriber base. At the end of 2016, total music subscriptions totaled 100.4 million.
At the end of 2015, music subscriptions reached 65.7 million. Midia explained the sudden surge in 2016.
“Revenues are growing, artist and songwriter discontent is on the wane and label business models are changing.”
Although music streaming is growing, there are still unresolved issues plaguing the industry, however, specifically with independent artists.
“But 100 million subscribers does not by any means signify that the model is now fixed and set. Smaller and mid tier artists are still struggling to make streaming cents add up to their lost sales dollars, download sales are in freefall, many smaller indie labels are set to have a streaming-driven cash flow crisis, and subscriber growth, while very strong, is not exceptional.”
Music Business World has a different take on Midia’s report. With music subscriptions steadily climbing, in 2016, they finally overtook Netflix’s numbers.
Back in 2015, the IFPI celebrated the news that over 60 million people paid for services like Spotify and Apple Music. Yet, that same year, Netflix told investors that the company had reached just under 71 million paid subscriptions. The TV and movie streamer has beaten out the music industry for several years. Yet, this year, Netflix only reached 87.8 million subscribers. While still impressive, 2016 marks the first time the music industry has overtaken the top TV and movie streamer.
Though the music industry boasts a higher number of subscriptions, Netflix still enjoys stronger streaming revenue turnover. According to MBW, the TV and movie streamer forecasts a $2.34 billion turnover in just 4Q 2016. Furthermore, the company estimates to have earned $8.28 billion in revenue for all of 2016. The company’s net income, however, is substantially lower, with a nine month profit of $119.9 million. In contrast, Spotify only earned $2.18 billion in revenue in 2015 and reported an annual loss of $194 million.
While music streaming numbers appear ready to grow even more in 2017, Midia had a warning for the music industry.