How is Big Data changing the music industry globally and how it impacts the decision making

The music industry is back on its feet again. In 2016, the global music market grew by almost 6%, according to IFPI’s global statistics[1], for the second year in a row. However, the music industry lost 40% of its revenues in the past 15 years, and this growth should be viewed as a positive trend in this wider context.

The overall revenues in 2016 came from different revenue streams, dominated by digital revenues with 50%, physical format sales 34%, performance rights 14% and synchronization revenues 2%. The digital revenues reached $7.8 billion, driven by skyrocketing growth of streaming by 60%, with more that 100 million active subscribers globally.


As the key hallmarks of digital music today, the researches underline the user behavior, a high level of consumer awareness and engagement, and of course the plethora of smart devices used for music listening and global connectivity. These factors are crucial for the massive data production, that global players are starting interpret and use to improve their products and services.

Some of the biggest M&A deals confirm this trend, starting with Spotify acquiring Echo Nest[2], music discovery technology company, for a rumored $100 million in 2014. The importance of online consumer data was confirmed again in 2015 with 2 major acquisitions: Pandora acquired Next Big Sound, a company specialized in tracking the popularity of songs online and on social media[3], and Apple that acquired Semetric, a UK startup behind the Musicmetric analytics tool, helping record labels track digital sales, streams and social stats[4].

The music analytics has become the biggest challenge for the entertainment industry, and learning how to read, interpret and give value to the data has become the essential skill. The synergy of technology and analysis will be the future for the music industry, leveraging Big Data as the best way to inform the decision-making path and create the “Big Insights” – a complete understanding of the relationship between a listener and the music.



[1] Digital music in figures

[2] Spotify Acquired Music Tech Company The Echo Nest In A $100M Deal

[3] Pandora Buys Next Big Sound to Track Popular Music

[4] Apple buys the British startup behind music analytics service Musicmetric