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Insights based on IFPI Global Music Report 2026: State of the Industry.
The global recorded music business is no longer fighting to prove that digital consumption can support growth. That question has been answered. Global recorded music revenues reached US$31.7 billion in 2025, surpassing US$30 billion for the first time and marking the industry’s 11th consecutive year of growth. Streaming now accounts for 69.6% of global recorded music revenue, with subscription streaming alone representing 52.4%.
Access-based consumption has become the industry’s dominant model. The more important questions are what kind of value this model produces, who captures that value, and how defensible it remains as AI, fraud, and regional fragmentation reshape the economics of culture.
The strategic shift: growth is giving way to control
The first phase of the streaming era was about distribution: making music widely available, opening access to catalogues, and converting listeners into paid subscribers. The next phase is about control. Rights, identity, provenance, pricing, artist economics, local market strength, and platform trust are becoming the industry’s key operating variables. Growth still matters, but without sufficient control, part of its value is lost.
Streaming has evolved from a distribution format into a more mature monetization model. Streaming revenues exceeded US$22 billion for the first time in 2025, growing 7.7% and adding US$1.6 billion in revenue. Subscription streaming rose 8.8%, while ad-supported streaming grew more modestly, at 4.3%.
That gap matters. Paid subscriptions are driving more of the industry’s revenue growth, and resilience increasingly depends on its ability to deepen subscription penetration, defend pricing, reduce fraudulent consumption, and convert listening into lasting fan relationships.
The geography of growth is also changing. The United States and Canada remain the largest recorded music region, accounting for 38.7% of global revenue, but the region grew by only 3.5%. Europe, the second-largest region, grew by 5.6% and accounted for 30.4% of global revenue.
The strongest growth is occurring elsewhere: Latin America grew by 17.1%, the Middle East and North Africa by 15.2%, Sub-Saharan Africa by 15.2%, and Asia by 10.9%. Mature markets remain the industry’s primary revenue base, but growth is becoming more geographically distributed, creating a more complex operating environment.
Asia shows why simple digital-transition narratives are no longer sufficient. The region grew by 10.9% in 2025. Japan returned to growth, at 8.9%, while China grew by 20.1% and overtook Germany to become the world’s fourth-largest recorded music market. At the same time, Asia accounted for 45.1% of global physical revenue.
This is not a linear transition from old formats to new ones. It is a multi-format fan economy in which streaming, physical products, catalogue value, live experiences, and fan engagement reinforce one another.
The 8.0% global increase in physical revenue, including 13.7% growth in vinyl revenue, reflects the same pattern. Physical music is no longer primarily a legacy format. It has become a collectible, identity-driven product for highly engaged fans.
The new investment logic: artist returns, long-term IP, and human capacity
The strongest assets are not simply tracks or catalogues. They are ecosystems capable of converting attention into multiple forms of value. A stream captures access. A ticket captures commitment. A vinyl purchase expresses identity. A direct-to-fan relationship creates opportunities for recurring engagement and revenue. Licensed AI use could create entirely new sources of demand.
The strategic question is no longer whether music can reach listeners. It is whether the industry can convert different levels of fan engagement into measurable, rights-protected revenue that can be reinvested.
The artist side of the equation is also changing. Artist remuneration as a share of global revenue increased from 31.0% in 2016 to 35.5% in 2024. This is significant because it challenges the assumption that traditional music-industry structures primarily weaken artists’ financial position. In a market where independent distribution is more accessible than ever, labels must demonstrate that they can improve artists’ long-term returns, not simply expand their reach.
That point becomes more important when considered alongside the scale of investment required to build durable careers. In 2024, record labels invested US$8.1 billion globally in A&R and marketing. That investment goes beyond promotional spending. It supports repertoire strategy, creative development, audience building, visual identity, touring momentum, brand partnerships, data analysis, content protection, and entry into international markets.
The modern music economy may appear frictionless to listeners, but building an artist’s career remains capital-intensive. Platforms and AI systems make distribution appear inexpensive, but they can obscure the cost of creating culturally meaningful work with lasting value.
This is why patience is becoming a strategic capability. The careers of Tate McRae, Balu Brigada, and Olivia Dean illustrate a model in which early signs of audience interest were combined with long-term artist development rather than replaced by short-term virality. Touring, fan behavior, a clear artistic identity, and carefully sequenced market expansion mattered as much as digital metrics.
Viral attention can validate demand, but it rarely builds lasting intellectual property on its own. The more difficult task is converting fragmented attention into a stronger catalogue, demand for live performances, lasting fan relationships, and international credibility.
Artist welfare belongs in the same discussion. The formal inclusion of artist welfare programs—including mental health support, well-being initiatives, and pastoral care—as part of the services labels provide is more than a symbolic gesture. It reflects a recognition that creative capacity is a core asset.
In an always-on market shaped by touring, social media, release cycles, and global visibility, unmanaged pressure can weaken the very asset base on which the industry depends. Support for artist well-being therefore becomes a form of human-capital risk management, aligned with broader expectations around responsibility, sustainability, and long-term stewardship.
Local culture is becoming a foundation for global growth
Regional trends point in a similar direction: global scale increasingly begins with strong local culture. Iberia’s role as a bridge between Europe, Latin America, and the United States illustrates how language and cultural proximity can create gateway markets. The growth of Música Mexicana shows how audiences across the United States and Mexico can behave less like two separate national markets and more like a connected cultural ecosystem.
Southeast Asia, with roughly 700 million people and a growing body of domestic repertoire, shows how local-language music can travel through shared emotion, subtitles, social platforms, diaspora connections, and regional youth culture.
The traditional global campaign model assumed that success moved outward from an artist’s domestic base. The emerging model follows cultural corridors through which identity already travels. The globalization of music is increasingly taking place through language, migration, community, platform behavior, and cultural affinity—not only through media spending.
This has strategic consequences beyond music. Generic global campaigns are less effective when cultural preferences are highly specific and audiences increasingly form their own communities. Local expertise becomes a strategic capability, not merely an execution function. The ability to understand where culture can travel without losing its identity is becoming a competitive advantage.
Rights, AI, and the economics of refusal
The biggest structural constraint is rights. Copyright is not merely a payment mechanism in this market; it provides the legal basis for bargaining power. The central issue is the ability to authorize, negotiate, refuse, and enforce the use of protected work.
This matters because the AI debate is not only about whether rights holders are compensated after their work has been used. It is about whether they retain the power to decide whether and how their work is used in new technology systems. A right to be paid is weaker than a right to refuse.
That distinction defines the central fault line in the AI debate. If AI developers can train models on music without authorization, artists, labels, publishers, and rights investors bear the cost of creative production while much of the resulting value shifts to model owners.
If licensing is voluntary and negotiated, music can become a structured input into new products, fan experiences, creative tools, and monetization models. The distinction is not between opposing innovation and supporting it. It is whether innovation is built on negotiated, compensated access or on the unauthorized extraction of creative value.
Public sentiment appears to favor consent over unrestricted use. In late 2025, IFPI surveyed approximately 10,000 people across the United Kingdom, France, Brazil, South Korea, and India. Across the five countries, 69% opposed AI companies using creative works to develop AI platforms without authorization or payment. Majorities also supported transparency rules requiring AI developers to disclose the content used to train their models, with support ranging from 63% in South Korea to 70% in India.
Performance rights represent another underdeveloped area of control. In 2025, performance rights generated US$2.9 billion, or 9.3% of global recorded music revenue, but grew by only 0.3%. That modest growth suggests that the industry may still be failing to capture the full value of these rights.
In markets where protections for broadcast and public performance rights are incomplete, poorly enforced, or inefficiently administered, value is not fully captured. This represents a potential source of non-streaming revenue, but realizing it depends on institutional infrastructure: legal frameworks, collection systems, licensing discipline, and market education.
Fraud, trust, and the next infrastructure bottleneck
The other major infrastructure risk is fraud. Streaming fraud has evolved from a nuisance into a strategic threat. Deezer reported that more than 60,000 fully AI-generated tracks were being uploaded to its platform each day in January 2026. It also indicated that up to 85% of streams involving AI-generated music were fraudulent in 2025, up from 70% the previous year.
This not only diverts royalties. It pollutes recommendation systems, weakens advertising effectiveness, distorts artist discovery, and reduces trust in platform data. As generative AI lowers the cost of producing synthetic content, fraud becomes cheaper to scale and harder to detect.
The response required increasingly resembles financial crime prevention rather than traditional rights enforcement. Identity verification, content vetting, industry-wide data sharing, and cross-platform intelligence are becoming necessary controls. Platforms, distributors, aggregators, labels, and enforcement bodies are all part of the same system of trust and accountability. If one part of the chain is weak, bad actors can simply move elsewhere.
The strategic risk is that streaming data will become less reliable just as more investment decisions begin to depend on it. In a market increasingly shaped by data-led discovery, catalogue valuation, marketing spending, and artist investment, polluted signals become a capital-allocation problem.
Strategic implications: from reach to resilience
The recorded music industry is entering a more complex but potentially more valuable phase. The simple growth story—more listeners, more streams, and broader access—is giving way to a more complex question of control: who owns the rights, who has the power to refuse, who can verify identity, who understands local culture, who can protect artists, who can price AI use, and who can distinguish genuine demand from synthetic noise?
The strongest positions will not belong only to organizations with the largest catalogues or the broadest distribution. They will belong to those that can combine investment in intellectual property, rights leverage, artist development, local expertise, and trusted infrastructure.
Music has become a test case for a broader question facing the digital economy: when technology can reproduce and distribute culture at near-zero marginal cost, value shifts toward organizations and systems that can verify authenticity, enforce consent, and convert attention into durable, protected revenue.
