Are We Reaching Peak Streaming Subscriptions?


Wren McDonald

For four years, the U.S. recorded-music business has grown at double-digit rates, but there are now 110 million subscribers — in a country with 110 million households. What happens next?

When it comes to technology startups, investors tend to focus on TAM, or "total addressable market." In venture capital argot, it’s the number of people who might be interested in a service, minus those who can’t afford it or don’t have the necessary technology — say, the number of people who might use the internet to stay in touch with friends or pay to watch movies at home.

These numbers tend to be big, but they’re not infinite. And after four straight years of double-digit growth in the United States, subscription music-streaming services, which have driven the recovery of the recorded-music industry and generated $3.7 billion, or half of all revenue flowing back to labels in 2019 alone, according to IFPI, are starting to run out of potential subscribers. The United States now has 110 million music-streaming subscriptions, which sounds like it leaves plenty of room for growth in a country of 333 million. But only 220 million are addressable by streaming services, according to the consultancy Omdia, and they live in just 110 million households — many of which share subscriptions.