Streaming will overtake downloading in 2018, says PwC report

Music streaming, one of the real growth areas in the global music industry, will overtake downloading in 2018.

According to accountant firm PwC's annual Global Entertainment and Media Outlook 2015-2019, streaming will reach US$1.9 billion in 2019, up 11.2% from $1.1 billion in 2014.

The move to streaming is so intense that its annual growth rate will be 20.3% this year, slowly plateauing to a 4% rate of growth by 2019.

Downloads in the meantime will decline at a rate of between 11.5% and 9.1%.

PwC estimates that revenue from digital music will be $3.4 billion in 2019. CDs will continue their fast descent to obscurity. Physical music sales will drop at a rate of 9.1% each year.

The recorded music industry will shrink at a rate of 4.5% a year over the next five years. This does not include revenue from the money made from sync rights, with tracks used in movies, jingles and TV shows.

But spending on live music tickets is expected to grow at 4.4% a year, more than cinema box office which is set to expand by 4% a year. More major brands wanting to get involved in concerts and tours. Live music sponsorships are tipped to grow at a 2.8% to $2.34 billion in 2019, according to PwC.

The report takes a five year outlook for global consumer spending and advertising revenues related to entertainment and media (E&M) content.

Global E&M spending is expected to rise from $1.74 trillion in 2014 to $2.23 trillion by 2019, growing by 5.1% a year. Consumers no longer differentiate between traditional and digital avenues when they spend. They only interested in attractive content, easy discovery, social community and an inspiring and personalised experience – however it’s delivered.

The U.S. remains the largest E&M market, growing at a 4.9% annually reaching $723 billion by 2019, from $568 billion in 2014. Media spend in America will reach $771 billion by 2019.

According to Outlook: “Against a background of shifting infrastructure and diverse local tastes, entertainment and media companies across the world need to embrace the consumption experience as their critical success factor. What matters is the ability to combine content with a user experience that’s differentiated and compelling on the consumer’s platform of choice.

“To achieve this blend, companies need to do three things: first, innovate around the product and the user experience; second, develop seamless consumer relationships across distribution channels; and third, put mobile (and increasingly video) at the centre.”