Total music revenues were down in 2014 but PWC’s Global Entertainment & Media Outlook for 2015-19 said music streaming is expected to push revenues up and account for almost half of the industry before the end of the decade.
Apple this week launched its long-awaited streaming service, Apple Music, built by the team from Beats Music, which they bought as part of a $3 billion deal last year.
They go up against Spotify, Amazon and Google who are already dominant in online music, which PwC said could see UK revenues hit £2.69 billion by 2019.
Last year, streaming revenue was £124 million, up 65 per cent on the previous year and nearly six times the industry value as in 2010. By 2019, streaming is expected to account for 49 per cent of music revenue, compared to 22 per cent in 2014.
Money from live music is also predicted to climb in the coming years said PwC, at a rate faster than sponsorship. They said new technology such as smart wristbands or other “wearables” could boost revenues from events or music.
Colin Slater, digital partner, PwC in Scotland, said: “The entertainment and media industry is at the forefront of the digital revolution, but its future success relies on continually building and enhancing the overall user experience in tune with advances in technology.
“With new subscription-based streaming services coming to market, UK music streaming is set for another strong year in 2015. It’s the music you want, when you want it and it’s more intuitive to your music taste, and we’re sure to see a surge during Scotland’s summer music festival season.
“The growth is being driven by the internet and the consumers love of mobile technology – consumers want a social experience as well as a personal one.
“However, in contrast, digital music downloading looks to have peaked. Last year digital music downloading started to decline and we forecast that this will continue to happen in 2015 and beyond.”
He added: “In a world that’s in beta, today’s entertainment and media companies need to do three things to succeed: innovate around the product and the user experience, develop seamless consumer relationships across distribution channels and put mobile – and increasingly video – at the centre of their consumer offerings.”
Apple launched its music service at their Worldwide Developers Conference earlier in the week in San Francisco, with rapper Drake.
He told the crowd: “This is something that simplifies everything for the modern musician like myself, and the modern consumer like you.”