Technology to Shape the Future of Media & Entertainment.

Tech Trends to Watch in Music, TV, and Other Creative Industries.

Streaming Drives Music and Video Revenue

While looking back at the past year, one thing becomes crystal clear: streaming has grown massively in 2017 and will continue to expand rapidly in 2018 and beyond. In fact, streaming has become the primary revenue driver for both music and video, thereby radically changing the way people consume content and profoundly altering the manner in which the industry and artists deliver media to fans.

Digital music downloads are quickly declining and being replaced by streaming, and it’s easy to understand why this is occurring. For the price of a single digital album download, consumers can gain access to tens of millions of songs via streaming services. And a growing number of music fans are making this switch, with over 100 million people now subscribed to such services around the world. According to the RIAA’s 2017 mid-year report, the U.S. recorded music industry experienced a 17% revenue increase in the first half of this year in comparison to 2016, and the primary driver of that growth is streaming. While total digital revenue accounted for $3.2 billion, or 84% of the total industry value, an impressive 62% came from streaming, equaling $2.5 billion.

Video streaming revenue is also growing at a staggering rate with no signs of slowing down. According to a report by Research and Markets, video streaming revenue is forecast to increase from $30.29 billion in 2016 to an incredible $70.05 billion by 2021, as consumers continue to embrace pay TV and OTT solutions for streaming videos. Moving forward, it’s expected that OTT will experience the most substantial market growth rate based on the increasing use of digital platforms for the branding and marketing of products.

Among other things, streaming powers the growth of digital distribution, creating more opportunities for independent artists. The world of independent music distribution has also expanded greatly over the past year, as a growing number of artists move away from major label deals to harness the personalized attention that indies can provide. UK-born company Ditto Music recently opened 12 new offices worldwide to serve its flourishing roster, while digital distribution and services company FUGA has signed a deal with London-based Ignition Records, following its expanding partnerships with a multitude of labels, including Epitaph Records and Ultra Records. Even Google is getting into the music industry with a big investment in the new US-based digital music distribution startup UnitedMasters, which was founded by the one-time President of Urban Music at Interscope Records, Steve Stoute.

Not surprisingly, the competition for streaming dollars has been growing exponentially. One of the biggest recent stories was Disney’s announcement that it is severing its distribution deal with Netflix in favor of launching its own streaming service in 2019. And now it is officially confirmed that Disney is buying some of 21st Century Fox’s entertainment assets, including the Fox movie and television studio and a share of Hulu, which will allow Disney to increase its television production to provide exclusive content on its forthcoming streaming offering.

Although some are still skeptical about the long-time inflow of streaming dollars, the streaming war is already fierce, and the battle is indeed just beginning. As companies attempt to secure dominance, technology will prove to be the best weapon in the streaming arsenal, thereby separating the leaders from the pack in the coming year.

The Future Is Data-Driven, So What Does The Data Say?

As digital and streaming solutions increasingly dominate the media industry, the role of data is rapidly evolving from being important to becoming absolutely vital. At this point, streaming has already grown to be the primary revenue driver for both music and video, making the effective analysis and utilization of data an essential component for success.

Technological advancements continue to transform every aspect of the media industry, from artist and concept development to licensing and the manner in which people consume their favorite music and TV shows. And data sits in the center of this entertainment revolution.

A thorough understanding of music data is a critical piece of the puzzle. Although this industry is notoriously unpredictable, data’s capacity to accurately predict and reveal insights makes it an incredibly powerful tool. An excellent example of this potential was illustrated by Jon Davies, Director of EU Music Partnerships at Shazam, who stated the app’s remarkable ability to utilize data in order to predict a hit from six to eight weeks in advance.

Data’s importance in the evolving world of television cannot be overstated, as consumers are presented with an increasing number of content and delivery choices driven by data-based decisions. An extensive report from communications technology and services company Ericsson clearly reveals the massive changes occurring in TV. For one, the firm’s study found that approximately 70% of consumers now watch television and videos on a smartphone, which is double the percentage from just five years ago. Ericsson predicts that by 2020, just 10% of people will watch TV only on a traditional screen, which would mark a 50% decrease in comparison to 2010. And as an increasing number of people embrace new technologies, many experts believe that VR will become an essential aspect of television and video in the not-too-distant future, with its social and immersive potential being realized in innovative and exciting new ways.

The skillful utilization of data is critical for success, while learning to be data-driven involves the extensive involvement of automation, machine learning and AI. The intricate melding of first, second and third-party data allows industry players to get the best results out of an algorithm, thereby positioning data to lead the way to making more effective decisions. Although humans will always be an essential part of successful enterprises, the complexities involved in analyzing massive quantities of data must be handled by machines as we move forward. Otherwise, the information will overwhelm and confuse us instead of providing invaluable insights into the habits and preferences of the swiftly-transforming consumer landscape.

The Future of Creative Industries in a Connected World

Technology is driving the digital revolution while consumers increasingly embrace innovative solutions for their media consumption. Global smartphone ownership crossed the 2 billion mark in 2014 and it’s expected to reach an incredible 4.6 billion by 2019. Our world is now connected through the internet and social media in ways that exceed even the wildest imaginations of technology innovators from the past.

The growing access to a myriad of devices, such as smartphones, smart speakers, connected cars and connected homes, enables people to be online virtually anywhere and anytime, consuming music and television shows on-the-go. And it is this fundamental shift in consumer behavior and technological advancement that’s driving the rapid growth of music and video streaming, along with the rising importance of data and its ability to alter the creation and delivery of all media types.

The coming year will bring a multitude of new utilizations of technologies to the forefront. It’s expected that voice-controlled technology will take on a much larger role in the near future, following the success of Amazon’s Echo smart home device and the company’s Alexa personal assistant. Forthcoming innovations in voice tech hold the potential to radically alter the manner in which consumers search for and listen to music, resulting in an even bigger impact on revenue moving forward. Machine learning and artificial intelligence will increasingly penetrate the media industry, as the analytical sector develops innovative solutions to make data input actionable.

Perhaps most importantly, technology will continue to greatly improve the consumer experience. From enhancing discovery abilities to providing increasingly personalized and curated content delivery, the digital world holds the potential to entertain people in incredible ways that were once relegated to dreams.

By Sergey Bludov
Senior Vice President of Media and Entertainment Practice at