Digital Music - Germany

Germany

Highlights

In Germany, revenue in the 2023 market is projected to reach US$1.82bn in 2024.
This revenue is expected to demonstrate an annual growth rate (CAGR 2024-2029) of 3.28%, leading to a projected market volume of US$2.14bn by 2029.
The largest market within this market in Germany is Music Streaming, which is anticipated to have a market volume of US$1.56bn in 2024.
In a global context, the majority of revenue will be generated the United States, with a figure of US$19.08bn in 2024.
In the 2023 market in Germany, the number of users is expected to reach 52.8m users by 2029.
User penetration in Germany will stand at 59.6% in 2024 and is projected to increase to 63.8% by 2029.
The estimated usage share of Spotify in the 2023 market in Germany was approximately 44.0% in 2023.
In the year 2023 a share of 35.5% of users is in the High income group.
Germany's digital music market is increasingly characterized by a growing demand for streaming services, reflecting shifting consumer preferences towards on-demand audio experiences.

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Digital Music market in Germany has experienced significant growth in recent years, driven by changing customer preferences, technological advancements, and local special circumstances.

Customer preferences: German consumers have shown a strong preference for digital music streaming services over physical formats such as CDs. This shift in customer behavior can be attributed to the convenience and accessibility offered by streaming platforms, which allow users to access a vast library of music on-demand from any device. Additionally, subscription-based models have gained popularity as they provide unlimited access to music without the need for individual purchases.

Trends in the market: One of the key trends in the German Digital Music market is the increasing adoption of paid streaming services. As consumers become more willing to pay for premium content, streaming platforms such as Spotify, Apple Music, and Amazon Music have gained a significant user base in Germany. This trend is further supported by the availability of affordable data plans and high-speed internet connections, which enable seamless streaming experiences. Another notable trend is the rise of local and regional music streaming platforms. While international platforms dominate the market, there has been a growing demand for German-language music and content. This has led to the emergence of platforms that cater specifically to the German market, offering a curated selection of local music and personalized recommendations.

Local special circumstances: Germany has a strong music culture, with a rich history of classical music and renowned composers. This cultural heritage has contributed to a strong appreciation for music among the German population. Furthermore, Germany has a vibrant music industry, with a diverse range of genres and artists. This has created a demand for digital music platforms that can cater to the varied tastes of German consumers.

Underlying macroeconomic factors: Germany has a robust economy, which provides consumers with the disposable income to spend on digital music services. Additionally, the country has a high smartphone penetration rate and a tech-savvy population, making it an attractive market for digital music providers. The government's focus on digital infrastructure development and promotion of digital innovation has also created a favorable environment for the growth of the Digital Music market in Germany. In conclusion, the Digital Music market in Germany is experiencing growth due to changing customer preferences, the adoption of paid streaming services, the emergence of local platforms, Germany's strong music culture, and favorable macroeconomic factors. As technology continues to evolve and consumer behavior evolves, the market is expected to further expand in the coming years.

Data coverage:

The data encompasses B2C enterprises. Figures are based on the Music, Radio & Podcasts market, which comprises all revenues generated by traditional and digital radio advertising, consumer purchases of live music event tickets, all sales of tangible audio recording formats, paid digital downloads of professionally produced single tracks / compilations, ad-supported services, and subscription-based, on-demand streaming services. All monetary figures refer to consumer spending on digital goods or subscriptions in the respective market. This spending factors in discounts, margins, and taxes.

Modeling approach / market size:

The market size is determined through a bottom-up approach. We use annual financial reports of the market-leading companies and industry associations, third-party studies and reports, survey results from our primary research (e.g., Consumer Insights), as well as performance factors (e.g., user penetration, price per product, usage) to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country-specific industry associations, such as various macroeconomic indicators, historical developments, current trends, and reported performance indicators of key market players. In particular, we consider average prices and annual purchase frequencies.

Forecasts:

We apply a variety of forecasting techniques, depending on the behavior of the relevant market. For instance, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption. The main drivers are GDP per capita, consumer spending per capita, and 4G coverage.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level. The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development). Consumer Insights data is reweighted for representativeness.