Emerging Markets Were the Story of 2024 & Other Takeaways From the RIAA, IFPI & MIDiA Reports

The trio of reports revealed continued subscription growth but smaller improvements than in previous years as the major labels increasingly look to small and developing markets.

Mar 21, 2025 - 21:20

Emerging Markets Were the Story of 2024 & Other Takeaways From the RIAA, IFPI & MIDiA Reports

A “datapocalypse” hit the music industry this week as both the RIAA and IFPI reported 2024 numbers, following MIDiA Research’s annual tally a week earlier — and all three agreed that growth slowed in 2024. The IFPI’s figures and rankings of top markets revealed the rise of emerging markets, while the U.S.-focused RIAA figures revealed that growth in the United States was particularly weak (although not the worst in the world).

The trends seen in these reports have consequences for the global music industry. Companies follow opportunities, and emerging markets are attractive places to put resources. In November, Billboard published a story about major labels’ pivot in investment strategy from tech startups to old-school music companies in small and developing markets. As majors face slowing growth in mature markets, they’re looking for growth elsewhere — especially China, India and Africa. Independent companies such as Believe have long pursued markets around the world, too, betting on the rise of streaming and the increasing popularity of local music.

The trio of reports underscore that slow streaming growth in many markets will need to be addressed. To that end, labels are already working to improve payouts through super-premium tiers that carry higher prices and working with streaming platforms to ensure “professional” artists get better remuneration than hobbyists, background noise and nature sounds. Ridding streaming platforms of AI-generated tracks will also improve labels’ payouts.

The reports differ because they represent different types of income. The IFPI reports trade revenue — the money collected by distributors and record labels — while much of the RIAA’s report shows the retail value, or the money collected by streaming platforms and retailers. In addition, the RIAA numbers cover only the U.S. while the IFPI and MIDiA reports track the global business. MIDiA Research includes additional revenue streams not found in RIAA or IFPI reports: expanded rights, which includes merchandise, sponsorships and other revenue that does not originate from master rights; and production music, which is growing in importance in music licensing but is typically outside the purview of record labels.

Following are the four main takeaways from the three reports.

Emerging Markets Were the Story of 2024

The most established markets mostly kept their place in the pecking order, but there was one momentous change in 2024. In a sign of the times, Australia, which ranked No. 10 on the IFPI rankings in both 2022 and 2023, was replaced by Mexico. While Australia improved 6.1%, Mexico expanded 15.6% thanks to a huge improvement in subscription revenue. In fact, the Latin America region grew an astounding 22.5%. Brazil, the No. 9 market, grew 21.7% — the fastest rate in the top 10.

Despite having a relatively small population of approximately 27 million, Australia has historically punched above its weight in music spending. The country ranked No. 6 in both 2014 and 2015 before falling off the top 10 in 2024 for the first time in nearly three decades. Meanwhile, Mexico — which had never cracked the top 10 before now — has roughly 130 million people, a booming streaming market and a flourishing music scene.

To be fair, Mexico is more of a mid-tier market than an emerging market. In terms of IFPI rankings, the country is emerging only in the sense that it “emerged” into the top 10. But it has a lot in common with emerging markets, including high growth rates and ample room for more subscriptions. In mature markets, subscribers are becoming harder to find.

China held firm at No. 5, its same ranking as the previous two years. With the world’s largest population and a fast-growing subscription streaming market, the country has risen from No. 7 in 2019 and No. 10 in 2017. Its largest music streaming company, Tencent Music Entertainment, finished the year with 121 million subscribers — more than all the streaming subscribers in the U.S.

In terms of pure growth rate, the top regions were the smaller Middle East-North Africa (MENA) and Sub-Saharan Africa, which grew at 22.8% and 22.6%, respectively.

Prior to 2024, the same markets had appeared in the top 10 for the last decade, sometimes in a different order. In 2017, China and Brazil entered the top 10, knocking out Italy and the Netherlands. Brazil had been in the top 10 in previous years but was absent in 2016. Now, with Mexico and emerging markets surging, we may be seeing a bigger shakeup in the top 10 in the future.

U.S. Growth Underperformed Nearly Every Other Market

In a business where year-over-year growth has become commonplace, the large, mature music markets don’t have the appeal of the smaller, fast-growing ones. So, while the U.S. remained the world’s largest market — by a wide margin — its revenue growth didn’t even keep up with 2024’s 2.9% inflation rate (depending on which numbers you’re looking at).

U.S. revenue growth slowed to 2.2% according to the IFPI report, or 3.2% according to the RIAA report. Together, the U.S. and Canada, which grew 1.5% in 2024, accounted for 40.3% of global revenue but grew just 2.1%, according to the IFPI report. Japan, the world’s second-largest market, dropped 0.2% as a 5.5% increase in streaming — led by a 7.2% gain in subscription revenue — was offset by a 2.7% decline in physical revenue. South Korea, the No. 7 market, fell 5.7%. The total Asia region grew 1.3%, however, in part due to China increasing 9.6%.

Some other major markets fared better than the U.S. As Billboard previously reported, U.K. revenues increased 4.8% and Germany rose 7.8%.

Subscriptions Are Stronger Than Ever

Subscriptions are the lifeblood of the record industry, accounting for more than 74% of global streaming revenue and 51.2% of total revenue in 2024, up from 49.1% in 2023, according to the IFPI. Of the global industry’s $1.4 billion added in 2024, $1.3 billion came from subscription streaming.

That said, the U.S. subscription market slowed considerably in 2024. Global subscription revenue rose 9.5% to $10.46 billion — almost double the 5.3% growth rate in the U.S., according to the RIAA. That 5.3% gain was half of 2023’s 10.6% improvement and well under 2022’s 7.2% growth (the 22.2% subscription growth seen in 2021 was a fortunate aberration of the pandemic). While a reversion to the mean was expected in successive years, 5.3% isn’t much, especially in a year when Spotify raised prices.

Ad-Supported Music, On the Other Hand…

Global ad-supported streaming grew just 3% to $3.62 billion, according to the IFPI. That’s a paltry number given the growth of streaming in large emerging markets such as India and Indonesia. But 3% global growth outperformed the U.S., where the RIAA report showed that ad-supported streaming dropped 1.8% and hasn’t had a double-digit gain since 2021.

For all the popularity of subscription music services, consumers will continue to use ad-supported platforms — video platforms like YouTube, social media apps like TikTok and radio services such as Pandora. And for freemium services such as Spotify, the ad-supported tier is a critical gateway to the premium tiers.

But the state of the economy suggests advertising dollars could be difficult in 2025, too, as advertisers tend to pull back their spending at the first signs of an economic slowdown. SiriusXM CFO Tom Barry, speaking at a banking conference on March 11, said advertising started “to see a drop-off” in previous weeks following the Trump administration’s tariff threats. “I would say we’re cautious about where the ad industry is going right now,” he warned.