2021
9
UK Music, CDs and Podcasts Market Report 2021
2021-12-08T03:06:54+00:00
OX1049259
2195
146107
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Report
en_GB
“2021 looks set to be another bumper year for the music industry. Music streaming will be buoyed by the mainstream rollout of high-res audio formats, whereas vinyl will continue to…

UK Music, CDs and Podcasts Market Report 2021

£ 2,195 (Excl.Tax)

Report Summary

The UK Music, CDs & Podcasts report identifies consumer attitudes towards the audio market, streaming services, and consumer opinion on music brands in the UK. This market report covers the market size, market forecast, market segmentation and industry trends for the Music Streaming, Downloads & Podcasts market in the UK.

Current Market Landscape

The music industry weathered the strains of COVID-19 well, with streaming revenues increasing and sales of physical formats proving resilient despite the closure of stores. Music is a somewhat weatherproof sector, performing well in all market conditions. It is strongly placed to continue its growth in the future, buoyed by the rollout of high-res and spatial audio features, continued growth in smart speakers and other connected devices, as well as further partnerships with gaming, fitness and social media companies.

  • 56% of music streaming listeners would happy to listen to adverts on a paid-for music streaming service when the artists receive the full revenue from them. This increases to 73% among Older Millennials.
  • Whilst 94% of consumers listen to music, just 52% pay for music in any form.

Whilst intrusive adverts can prove a distraction and in some areas a catalyst for churn from a service (for instance with mobile device and gaming apps), opt-in adverts could create a direct revenue source for creators and more opportunities for brand tie-ups for streamers.

Future Market Trends in Music and Other Audio

Despite music’s position as a recession-proof sector, the cost of living crisis could have a knock-on effect in the confidence and spending power of consumers, which can hamper growth or make some consider cutting back on subscription services, of which paid music streaming services are not immune.

With only around half of consumers paying for music in any form, it suggests that there remains significant headroom for growth by turning music listeners into paying customers. New cut-price audio-only streaming services, accessible by voice assistant, could help bring in more casual listeners to the music habit, who may not be minded to be making playlists or curating their own personal digital record collection. 

Read on to discover more details or take a look at all of our UK Media, Books and Stationary market research.

Quickly understand

  • The impact of COVID-19 on the market for music and other audio including CDs, streaming, downloads and podcasts.
  • Launch activity and innovations of companies operating in the music and audio sector.
  • Wider market drivers impacting on the music and audio sector.
  • The market size and forecast for music industry income from 2016-26.
  • Consumer opinion of brands operating in the UK music and audio market.
  • Use of streaming services both paid and free, listening occasions of both podcasts and music, what devices consumers use to listen to music on and consumer attitudes towards music and audio.

Covered in this report

Products: Physical media (CDs, vinyl), music streaming services, music downloads, podcasts (streaming, downloads).

Brands: Apple, Sony, Tidal, Deezer, Warner Music Group, Spotify, Netflix, Universal Music Group, Google, YouTube, Clubhouse.

Expert analysis from a specialist in the field

This report, written by Joe Birch, a leading analyst in the Retail sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

2021 looks set to be another bumper year for the music industry. Music streaming will be buoyed by the mainstream rollout of high-res audio formats, whereas vinyl will continue to attract fans looking for an authentic music listening experience. The growth in connected devices will also increase listening occasions and streaming’s footprint. Longer term, innovations within the music platform space will see greater convergence of music with other entertainment formats such as gaming, driving music’s influence and creating greater opportunities for social discovery and community building.

Joe Birch
Consumer Technology Analyst

Table of Contents

  1. Overview

      • Key issues covered in this Report
        • COVID-19: Market context
          • Economic and other assumptions
            • Products covered in this Report
            • Executive Summary

                • Impact of COVID-19 on music and audio
                  • Figure 1: Short, medium and long-term impact of COVID-19 on music and other audio, 2021
                • The market
                  • Streaming continues to be music revenue’s star turn
                    • Figure 2: Market size for music industry income, 2016-26
                  • Consumer confidence hits record highs in 2021, but tails off in October as cost of living crisis bites
                    • Hybrid working drives adoption of smart speakers
                      • Nostalgia played an important role in music choice during the pandemic
                        • Physical sales could take hit with delays in manufacturing of vinyl
                          • The metaverse could transform the way music is experienced
                            • Gaming will provide the next big platform for music engagement
                              • Companies and brands
                                • Musicians join the NFT bandwagon
                                  • Use of AI to increase its influence in music consumption and creation
                                    • Clubhouse announces new music mode
                                      • Social audio gaining momentum
                                        • The consumer
                                          • Listening to music is a near ubiquitous habit for consumers
                                            • Figure 3: Methods for listening to music in the last three months, 2021
                                          • Over three in 10 have a paid-for music subscription
                                            • Figure 4: Music formats paid for in the last three months, 2021
                                          • YouTube’s popularity has waned since 2019
                                            • Figure 5: Use of free streaming services to listen to music, 2019-21
                                          • Changing working patterns mean connected home devices are gaining traction
                                            • Figure 6: Devices used to listen to music, 2021
                                          • For the youngest consumers, music is the soundtrack of their lives
                                            • Figure 7: Occasions for listening to music, 2021
                                          • Relaxing at home is the key occasion for listening to podcasts
                                            • Figure 8: Podcast listening occasions, 2021
                                          • High-res audio poised to have its moment
                                            • Sales of peripherals can benefit as consumers seek upgraded sound experience
                                              • Figure 9: Attitudes towards music, 2021
                                          • Issues and Insights

                                            • Build digital communities around shared interests
                                              • Give fans the power to support their favourite artists
                                                • Music experiences could underpin the shift to the Metaverse
                                                • Market Size and Performance

                                                  • Streaming continues to be music revenue’s star turn
                                                    • Vinyl revival cushions physical music’s downturn
                                                      • Digital downloads can cater to the collector as well as those who want to support artists
                                                        • Figure 10: Music industry income, by segment, 2016-20
                                                      • Music shows its resilience through good times and bad
                                                        • Figure 11: Short, medium and long-term impact of COVID-19 on music and other audio, 2021
                                                    • Market Forecast

                                                      • 2021 another record-breaking year for music revenues
                                                        • The battle to convert free users to paid subscribers
                                                          • High-res audio formats offer a reason to upgrade
                                                            • Variable pricing can bring in new entrants and drive more value from existing users
                                                              • Mintel estimates that the market will grow to £1.5 billion by 2026
                                                                • Figure 12: Market size for music industry income, 2016-26
                                                                • Figure 13: Music industry income, 2016-26
                                                              • Market drivers and assumptions
                                                                • Figure 14: Key drivers affecting Mintel’s market forecast, 2015-26
                                                              • Forecast methodology
                                                              • Market Forecast Segmentation

                                                                • Streaming continues to be music revenue’s star turn
                                                                  • Figure 15: Forecast of music industry income from streaming, 2016-26
                                                                • Vinyl revival cushions physical music’s downturn
                                                                  • Figure 16: Forecast of music industry income from physical formats, 2016-26
                                                                • Digital downloads can cater to the collector as well as those who want to support artists
                                                                  • Figure 17: Forecast of music industry income from digital, 2016-26
                                                              • Market Drivers

                                                                • Consumer confidence hits record highs in 2021…
                                                                  • …but drop-off in October hints at belt tightening
                                                                    • Challenging outlook demands platforms justify the price of a subscription
                                                                      • Figure 18: The financial wellbeing index, 2016-21
                                                                    • Hybrid working drives adoption of smart speakers
                                                                      • Figure 19: Intent to purchase selected smart home devices, 2021
                                                                    • Live music streaming may see an adjustment after highs of COVID-19 peaks
                                                                      • Figure 20: Future interest in cultural events, 2021
                                                                    • Nostalgia played an important role in music choice during the pandemic
                                                                      • Music catalogue rights acquisitions will create opportunities to bring old classics to new audiences
                                                                        • Figure 21: Key factors driving consumer behaviour around experiences, 2021
                                                                      • Physical sales could take hit with delays in manufacturing of vinyl
                                                                        • Figure 22: Percentage of streamed music that is attributable to catalogue content, 2016-20
                                                                      • The metaverse could transform the way music is experienced
                                                                        • Gaming will provide the next big platform for music engagement
                                                                        • Regulatory and Legislative Changes

                                                                          • CMA announces probe into music streaming industry
                                                                            • For the vast majority of recording artists, money’s too tight to mention
                                                                              • The CMA could look at enforcing more equitable streaming models as an alternative
                                                                                • Mainstream artists lobby for change in copyright act
                                                                                • Launch Activity and Innovation

                                                                                  • Musicians join the NFT bandwagon
                                                                                    • NFTs offer a new opportunity to create a band-fan community
                                                                                      • Adding new revenue streams
                                                                                        • Lost Tapes of the 27 Club uses AI to recreate “new songs” from deceased artists
                                                                                          • Tech start-up creates AI-powered DJ
                                                                                            • AI-powered technology deconstructs music into accessible and mixable stems
                                                                                              • 360 Reality Audio sees music move on from stereo confines
                                                                                                • Streaming services start to offer merchandise on-site
                                                                                                  • Warner Music Group partners with messaging tool Community
                                                                                                    • Music and sound start-ups continue to play a role in mental health and physical wellbeing
                                                                                                      • Netflix eyes up podcasts after new forays into world of gaming
                                                                                                        • Clubhouse announces new music mode
                                                                                                          • Social audio gaining momentum
                                                                                                            • YouTube moves free YouTube Music to audio-only experience in Canada
                                                                                                              • Pixel Pass could be coming to the UK, paving the way for Google’s tilt at the hardware and subscription model market
                                                                                                                • Rollout of TikTok-inspired YouTube Shorts goes global in June 2021
                                                                                                                  • Deezer launches Flow Moods streaming to create “emotional jukebox”
                                                                                                                  • Competitive Strategies

                                                                                                                    • Price increases and monetised content will help bolster revenues
                                                                                                                      • New features and content can help provide value for money
                                                                                                                        • Tools to help discover music in-app will bolster advertising opportunities
                                                                                                                          • Podcasting will benefit from similar discovery tools
                                                                                                                            • Hardware sales growth and tie-ups with new platforms will increase music’s footprint
                                                                                                                              • Integration with social channels will empower discovery and engagement with music and audio
                                                                                                                                • Leveraging the power of community for better connection and curation
                                                                                                                                  • Bundling services to enhance appeal
                                                                                                                                    • Improving sound quality to reach audiophiles
                                                                                                                                    • Brand Research

                                                                                                                                        • Brand map
                                                                                                                                          • Figure 23: Attitudes towards and usage of selected brands, 2021
                                                                                                                                        • Key brand metrics
                                                                                                                                          • Figure 24: Key metrics for selected brands, 2021
                                                                                                                                        • Brand attitudes: Deezer is seen as an innovative brand
                                                                                                                                          • Figure 25: Attitudes, by brand, 2021
                                                                                                                                        • Brand personality: Apple Music and Spotify add some fun to streaming
                                                                                                                                          • Figure 26: Brand personality – macro image, 2021
                                                                                                                                        • Spotify edges Amazon and Apple in key metrics
                                                                                                                                          • Figure 27: Brand personality – micro image, 2021
                                                                                                                                        • Brand analysis
                                                                                                                                          • Over half of users have ever used market leader Spotify
                                                                                                                                            • Nearly eight in 10 would give a positive endorsement of YouTube Music
                                                                                                                                              • Amazon Music benefits from its reputation for efficiency
                                                                                                                                                • Apple is seen as an exclusive brand
                                                                                                                                                  • Deezer has lowest brand awareness of the major music streaming services
                                                                                                                                                  • Music Listening and Purchasing Habits

                                                                                                                                                    • Listening to music is a near ubiquitous habit for consumers
                                                                                                                                                      • Figure 28: Methods for listening to music in the last three months, 2021
                                                                                                                                                    • Generations listen to music on devices they have grown up with
                                                                                                                                                      • Radio can learn from social apps to boost viral awareness
                                                                                                                                                        • Figure 29: Methods for listening to music in the last three months, by generation, 2021
                                                                                                                                                      • Listening to music spans multiple formats
                                                                                                                                                        • Figure 30: Repertoire analysis of methods for listening to music in the last three months, 2021
                                                                                                                                                      • Over three in 10 have a paid-for music subscription
                                                                                                                                                        • Physical formats and downloads can hold up well and engage with younger audiences
                                                                                                                                                          • Figure 31: Music formats paid for in the last three months, 2021
                                                                                                                                                      • Use of Music Streaming Services

                                                                                                                                                        • YouTube’s popularity has waned since 2019
                                                                                                                                                          • BBC Sounds App needs to amplify its wealth of historic archive performances
                                                                                                                                                            • Link audio and visual content in-app for a richer experience
                                                                                                                                                              • Figure 32: Use of free streaming services to listen to music, 2019-21
                                                                                                                                                            • Relative stability in terms of market share of main paid-for music streaming sites
                                                                                                                                                              • Figure 33: Use of paid-for music streaming sites, 2019-21
                                                                                                                                                            • Tidal’s focus on quality sees it gain traction
                                                                                                                                                              • Figure 34: Use of paid-for music streaming sites, by socio-economic group, 2021
                                                                                                                                                            • Bundling can provide value and convenience and drive share of new subscription activity
                                                                                                                                                              • Focus on relevant content of streaming services to appeal to older age groups
                                                                                                                                                                • Tap in to over-55s’ increasing use of streaming entertainment to grow subscriber bases
                                                                                                                                                                  • Figure 35: Use of paid-for music streaming sites, by age, 2021
                                                                                                                                                              • Devices Used to Listen to Music

                                                                                                                                                                • Changing working patterns mean connected home devices are gaining traction
                                                                                                                                                                  • Smart speakers can facilitate cut-price music offering
                                                                                                                                                                    • Figure 36: Devices used to listen to music, 2021
                                                                                                                                                                  • Portability is key in devices used for listening to music
                                                                                                                                                                    • Figure 37: Devices used to listen to music, by generation, 2021
                                                                                                                                                                  • Consumers want a seamless experience across devices
                                                                                                                                                                    • The Metaverse will offer a new way to experience music
                                                                                                                                                                      • Figure 38: Repertoire of devices used to listen to music, 2021
                                                                                                                                                                  • Music Listening Locations

                                                                                                                                                                    • For the youngest consumers, music is the soundtrack of their lives
                                                                                                                                                                      • Music can be a working and studying aid
                                                                                                                                                                        • Figure 39: Occasions for listening to music, 2021
                                                                                                                                                                      • Have a quick call to action to get older audiences to try podcasts
                                                                                                                                                                        • Figure 40: Podcast listening occasions, by gender and age, 2021
                                                                                                                                                                    • Podcast Listening Locations

                                                                                                                                                                      • Relaxing at home is the key occasion for listening to podcasts
                                                                                                                                                                        • Figure 41: Podcast listening occasions, 2021
                                                                                                                                                                    • Attitudes towards Music

                                                                                                                                                                      • High-res audio poised to have its moment
                                                                                                                                                                        • Sales of peripherals can benefit as consumers seek upgraded sound experience
                                                                                                                                                                          • Figure 42: Attitudes towards music, 2021
                                                                                                                                                                        • Leverage the power of community and promote music to help consumers express their identity
                                                                                                                                                                          • Figure 43: Attitudes towards music, by age, 2021
                                                                                                                                                                        • Music can help other sectors connect with their customers
                                                                                                                                                                          • Consumers want their favoured artists to benefit from their consumption choices
                                                                                                                                                                            • Streaming platforms are well placed to add value-added extras such as merchandising and paid livestreaming
                                                                                                                                                                              • NFTs and digital collectibles can be an untapped marketplace
                                                                                                                                                                                • Figure 44: Attitudes towards music, by purchase of music formats, 2021
                                                                                                                                                                            • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                                • Abbreviations
                                                                                                                                                                                  • Consumer research methodology
                                                                                                                                                                                  • Appendix – Central Forecast Methodology

                                                                                                                                                                                    • Market forecast and prediction intervals
                                                                                                                                                                                      • Figure 45: Lower bound, central and upper bound forecast for music, 2021-26
                                                                                                                                                                                    • Market drivers and assumptions
                                                                                                                                                                                      • Figure 46: Key drivers affecting Mintel’s market forecast, 2021-26
                                                                                                                                                                                    • Forecast methodology

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