The Global Music on Demand Market is becoming more versatile and dynamic. Music on demand services address the increasing need for music on the go. The rise in technological advancements is expected to increase the demand for music streaming among smartphone users during the forecast period.
The subscription service provided by the service providers has helped in decreasing the piracy. With the growing Global Smartphone Market, music on demand services for mobile devices have increased.
The growing Global Mobile Ad Market is also expected to bring more revenue for service providers that provide music on demand for mobile devices. The service provider can use the space available in its application to generate extra revenue by displaying ads and providing freemium services in addition to subscription services.
TechNavio analysts have pinpointed five key trends helping to advance the Music on Demand Market to new heights, not to mention fuelling market growth at a CAGR of over 20 percent from 2013-2018:
Increase in Adoption of Cloud Services in Music Streaming
Cloud computing provides consumers with legal access to music online and is rapidly being adopted by firms because it enhances portability, enabling subscribed users to access digital content stored in remote servers irrespective of the devices used. Listening to music, initially, was only possible using devices such as iPods. But the current scenario is witnessing consumers switching to an access-based approach, which consists of subscribing to digital music libraries stored in the cloud.
Cloud-based music services such as iTunes Match have become a market reality and have increased the popularity of music downloads. Historically, companies such as Apple Inc., Google Inc., and Amazon Inc. have primarily focused on cloud music from a storage perspective, as a remote locker for downloaded tracks. Such developments are expected to help content companies generate higher revenues from digital fronts.
Use of Metadata
Metadata is the information embedded in a music file that provides information about its audio content such as the track name, artist’s name, and bit rate. The introduction of digital music has increased the importance of metadata. Approximately 20 percent of visits to music websites are from a mobile device.
Vendors in the Global Music on Demand Market are exploring this field to integrate various features such as lyrics and sing-along into the audio file. This provides market vendors with a selling point, which will drive market growth during the forecast period.
Increase in Initiatives to Curb Piracy
The Global Music on Demand Market loses a significant portion of its revenue to piracy. Hence, various initiatives are being implemented to curb piracy. There are various laws, in different countries, which promote the protection and distribution of creative works on the internet. The US and South Korea have copyright alert systems that keep tabs on piracy.
In Europe, as directed by its courts, internet service providers have blocked access to The Pirate Bay, which has reduced the illegal download of games, movies, and music substantially. This has been shown to have a positive impact on consumer behavior.
In addition, music firms request search engines such as Google to prioritize legitimate sites in the search pages.
Consolidation of the Market
Mergers and acquisitions, strategic alliances, and partnerships are corporate strategies that help an enterprise to sustain its growth. They are undertaken to increase market share, gain new domain knowledge, enter new markets, lower operation costs, enhance industry know-how, improve profitability, and gain new clients. Such mergers and acquisition activities enable companies to further diversify their product portfolios by introducing new products for various industry verticals. They also increase the market reach of products, thereby increasing companies’ top line revenues.
Major music recording firms such as Universal Music Group (UMG), Warner Music Group, and Sony Music Entertainment have adopted these strategies to revitalize their market presence. Recently, UMG partnered with the social crowd-sourcing platform, Talenthouse, to create a variety of campaigns for its roster of chart-topping artists. The company has also partnered with Free All Music, a digital music download service that provides customers with free and legal downloads from UMG’s wide-ranging digital catalogue.
Wearable Technology
Smartphone manufacturers are developing and introducing various types of wearable gadgets that can connect to smartphones. The coming years will witness music streaming vendors developing applications and interfaces that will support the wearable smart device. This will enable users to directly stream music using these gadgets connected to smartphones.
Cover Photo by: Joseph Thornton via Flickr (cc)
