Despite signs of a streaming slowdown, total revenues are still increasing dramatically. According to the Consumer Technology Association’s U.S. Consumer Technology Sales and Forecasts, the forecast for 2019 remains green-n-sunny, with continued growth ahead.
The report is published twice per year, in July and January.
Specifically, the CTA indicated that the revenue of “on-demand music services” will cross the $8.4 billion mark this year —which marks a growth of about 33 percent. This continued uptick in music service subscriptions comes alongside a huge increase in the number of smart speakers and innovative mobile devices, including smartwatches and wireless earbuds.
Per the same report, wireless earbuds will be up almost 50 percent in both revenue and sales volume this year, while smartwatch revenue will see a 20 percent bump from 2018 levels. Not bad for two CE devices that barely existed a decade ago (or even five years ago in substantive quantities).
More encouraging yet is that the broader streaming category is also surging; this point illustrates the nationwide (and perhaps the worldwide) viability of the subscription business model. Video-streaming revenue will near $18 billion in 2019, according to the CTA; this is an increase of about 25 percent compared to 2018.
Also, gaming streaming, memberships, and micro-transactions will coordinate to produce almost $40 billion in 2019, a boost of 11 percent.
Perhaps one caveat worth mentioning: CTA’s numbers are probably on the bullish side, given the trade group’s constituency of CE manufacturers (and its ecosystem of supporters). That said, CTA’s specific interest in streaming is less direct, given that consumer electronics devices are typically adaptive to the specific format demands of consumers.
In short, consumers are quickly gravitating towards subscription services — especially music streaming services. As a consequence, nearly every other music format except for vinyl is tanking, including Apple’s once-steady iTunes paid download.
Spotify, Apple Music, Amazon Music, and Pandora are all “in the mix” when it comes to securing new subscribers and convincing existing subscribers to switch services. For now, the companies have little to fret about in terms of attracting new customers; the market is taking care of that. But as overall growth slows, these brands may need to draw subscribers in with even spicier deals and features, and accordingly, it appears that customers will continue to win for quite a while to come.
Credit: Digital Music/Digishare Africa/KwameBoade