Spotify Market Share Decline - Latest Music Service Stats

Global Music Streaming Growth and Market Dynamics

The global expansion of music streaming continues at a significant pace. Recent data from MIDiA, a leading entertainment research company, indicates that 523.9 million individuals were subscribed to a music streaming platform as of the second quarter of 2021.

This represents an increase of 109.5 million subscribers, equivalent to 26.4%, compared to the figures recorded in the prior year.

Spotify's Position and Emerging Competition

Spotify currently holds the largest share of the music streaming market, accounting for 31% of all subscriptions. However, its market dominance is experiencing a gradual decline.

In 2020, Spotify controlled 33% of the market, and in 2019, this figure stood at 34%.

Despite adding a greater number of total subscribers than its competitors in the year preceding Q2 2021, Spotify’s growth rate of 20% was surpassed by Amazon Music, which grew by 25%.

Notably, Google’s YouTube Music demonstrated the most substantial growth, exceeding 50% over the same period. This makes it the sole major Western streaming service to have increased its global market share.

Tencent Music, operated by the Chinese gaming corporation Tencent, currently possesses the same market share as Amazon Music.

Impact of Audio Quality and Future Developments

The market positions of Amazon Music and Apple Music are poised for potential growth. This is because the reported data only extends to Q2 2021 and does not reflect the impact of lossless audio becoming available on both platforms in May.

Spotify previously announced plans to launch a premium subscription tier, Spotify Hi-Fi, offering music in a “CD-quality, lossless audio format.” However, the release date for this service remains unspecified.

Tidal's Focus on Audio Quality and Artist Compensation

Tidal has historically catered to consumers prioritizing superior audio quality. Despite offering a lossless audio tier at $9.99 per month – the same price as Apple Music, and only $2 more than Amazon Music – Tidal’s global market share remains below 2%, as per MIDiA’s report.

Founded by Jay-Z and subsequently acquired by Block, Tidal positions itself as a platform that ensures artists can share their music “precisely as the artist intended,” emphasizing exceptional audio fidelity.

Innovative Approaches to Artist Revenue

Under Block’s ownership, Tidal is expanding its focus beyond sound quality to explore methods of increasing profitability for artists.

In early 2022, Tidal introduced direct-artist payouts for its top HiFi Plus subscribers ($19.99/month), allocating 10% of each user’s subscription fee directly to their most frequently listened-to artists.

Later in 2022, the platform plans to implement fan-centered royalties, ensuring artists are compensated based on the individual streaming patterns of their listeners.

The Potential for Tidal's Growth

It remains to be seen whether these initiatives will attract new subscribers who prioritize artist compensation over high-fidelity audio. This strategy is a worthwhile endeavor, as Deezer, which is also working towards user-centric payments, currently holds a 2% market share – exceeding that of Tidal.