Warner Music’s quarterly financial results came out this week, showing record-breaking revenue of $1.33 billion.
The report provided interesting insights into the future of the music industry, especially in pandemic times. It also highlighted some less traditional platforms that could steal the show.
Warner reported that streaming revenue was up 17.5% in the last quarter. Streaming services like Spotify and iTunes are still major, but the jump was also spurred by the social media platform TikTok, which features short videos, often with music.
Professor George Howard teaches business at Berklee College of Music. He said this, in part, reflects how the coronavirus pandemic has changed the way we listen. “People aren’t commuting as much, so they’re not listening to music in the car. People aren’t drowning out their co-workers in their cubicles with music.”
What a lot of people are doing is spending time on social media. Warner Bros. recently signed a licensing deal with TikTok.
“I think it’s pretty clear from the past year or so that TikTok is just a tremendous driver of audience, new songs and old songs,” said Mikael Wood, a pop music critic at the Los Angeles Times. Like Lil Nas X, one of the most notable artists to be launched on TikTok.
This earnings report also highlighted how, during the pandemic, gaming platforms have been hosting live performances.
“There were really no live concerts in 2020. There likely won’t be a lot of live music this year either. So a lot of that is shifting online,” said Peter Vahle, a music analyst at eMarketer.
Just last month, Warner invested a reported eight figures in Roblox, a gaming platform geared toward kids with 150 million monthly users.
So while the music industry is notoriously slow to change, it’s clear the pandemic is already causing massive shifts.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?