Music streaming

Music streaming stocks to watch as distancing aids adoption

The COVID-19 pandemic has given a major boost to the music streaming industry which has gained in both revenue and subscribers due to lack of live concerts, limited capacity during sporting events and cinemas, leading consumers to connect to music streaming. apps.

According to the RIAA report, the music streaming industry saw more than 15 million new users purchase subscriptions, reaching a total of 75.5 million paying subscribers across the United States in 2020, while total recorded music revenues increased 9.2% year-on-year. on an annual basis to $12.2 billion.

There has been a significant increase in the number of subscribers on various platforms such as Spotify SQUARE, Apple Music AAPL, SiriusXM, Alphabet‘s GOOGL YouTube is owned by Google and AmazonAmazon Music’s AMZN services, which are facing increasing competition from peers such as Tencent Music Entertainment, Tidal, Deezer and iHeart Radio. This should continue until 2021.

Performance since the beginning of the year

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Music streaming services ready to grow

While CDs, vinyls and cassettes have found a small but passionate audience, most people listen to music today through a streaming service.

Rising penetration of smartphones, digital platforms, growing fan base of popular artists, and aggressive investments by record labels have sparked the growth of music streaming services despite data privacy, security of databases and copyright infringement issues.

Additionally, the growing proliferation of smart speakers and wearable devices that allow synchronization with music streaming apps is increasing the demand for such apps.

According to a report by Research and Markets, the global music streaming market is poised to grow by $7.47 billion between 2021 and 2025 at a CAGR of 19%.

Additionally, increasing mobile ad spend and number of subscription services are also expected to drive the growth of the music streaming market.

Furthermore, the introduction of 5G, AI, ML and the increase in internet population in developing countries are creating new long-term opportunities.

Apple Music boosts its streaming presence

Apple will offer two new features to its Apple Music subscribers, lossless audio and Dolby Atmos tracks. Both features will be available from June at no additional cost.

Apple Music adds lossless audio support for its entire catalog of 75 million songs. Additionally, Apple is adding support for spatial audio with Dolby Atmos.

Additionally, this Zacks Rank #2 (Buy) company would add a level of high fidelity (HiFi) audio streaming to Apple Music in the coming weeks with Apple Airpods 3. You can see the full list of today’s Zacks #1 Rank ‘hui (Strong Buy) shares here.

Apple Music also hosts exclusive content such as Apple Music 1, Apple Music Hits, and Apple Music Country radio stations.

Spotify’s growing premium subscribers pose a threat

Spotify benefits from the growth of premium subscribers. The focus on customizing playlists enhances users’ music experience.

Spotify Connect – the service’s protocol for connecting to third-party devices – makes it even more accessible, allowing it to connect to various products, from wireless speakers to game consoles and more.

Plus, robust playlists help this Zacks Rank #3 (Hold) company quickly convert free listeners into paid subscribers. The popular music streaming app has 70 million tracks, 2.2 million podcast titles and 356 million monthly active users, including 158 million subscribers in 178 markets.

In February, Spotify announced that Spotify HiFi, which will also offer high quality and lossless sound, will be launched later this year.

Amazon’s aggressive stance to strengthen its market position

Recently, Amazon announced that Amazon Music HD, the high-quality streaming tier it launched in 2019, will be available to all eligible Amazon Music Unlimited subscribers at no additional cost for $9.99 per month. It was previously available for an additional $5 per month.

Amazon Music’s HD catalog has over 70 million songs and over 7 million Ultra HD tracks are available. Amazon Music HD customers can also access a growing catalog of remixed songs in 3D audio formats such as Dolby Atmos and Sony 360RA, which can be played on Amazon’s own high-fidelity speaker, the Echo Studio.

The hottest, hottest and newest podcasts are streamed on Amazon Music. Additionally, many original podcasts hosted by Will Smith, Dan Patrick, DJ Khaled, and Becky G are available. These podcasts are also accessible from the Amazon Echo smart speaker in addition to the Amazon Music app.

Besides podcasts, Amazon, which currently carries a Zacks Rank #3, has taken a revolutionary step in the streaming world by integrating Amazon Music into Twitch’s live streaming feature. The move provides various options for users to explore live streaming of their favorite artists on the Amazon Music app.

Should Google’s YouTube be worried?

Alphabet’s Google division is doing all it can to boost its presence in the music streaming market with updated YouTube Music features. YouTube continues to have over 2 billion monthly logged-in users who watch over 1 billion hours of video per day.

At the end of the first quarter of 2021, Youtube had $6 billion in advertising revenue, up 49% year-over-year.

Additionally, the growing popularity of YouTube Shorts – a TikTok-like short video feature – is a major boost for this Zacks Rank #2 company. Notably, Youtube Shorts recorded 6.5 billion daily views in March, compared to 3.5 billion at the end of 2020.

Besides, Square SQ is making a foray into the burgeoning music streaming space with a definitive agreement to acquire a majority stake in Jay-Z’s music streaming service called Tidal. The transaction is expected to close in the second quarter of 2021.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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