August 27, 2018

Should The Music Industry Be Worried About Teen Social Media Cord Cutting?

teen social media on the Music 3.0 BlogWe all spend an enormous amount of time online these days and for many of us much of that comes by way of our smartphones. In fact, studies indicate that the younger the demographic, the more likely they’ll be tied to their phones. That’s generally been a good thing for the music industry since streaming growth has been driven by smartphone use thanks to teens and millennials being addicted to various social media platforms. But what would happen to streaming usage if that social media usage was decreased?

It’s no secret that parents have been worried about their kid’s smartphone usage for some time, but according to a new study by the Pew Research Center, now the teens themselves are worrying too.

In the study, 54% of teens thought that they now spend too much time on their phones, and 52% reported that they were actively trying to limit their phone usage. For 57%, that meant limiting social media consumption while 58% sought to limit their video game time. What’s more, 90% believe that they spend too much time online in general, with 60% believing that it’s to a point of being a major problem.

Both the tech and music industry have happily rode along with teen phone addiction, reaping the rewards of increased streaming usage that continue to rise skyward with each passing quarter. With the happy days back again, music and streaming platform execs have ideas of continuing the growth by converting emerging markets into new areas of mass subscribers. While that may yet come to pass, the fact that U.S. teens are even considering limiting their phone usage may in fact be a canary in music streaming’s coal mine.

The total number of music streaming subscribers in the United States may already be plateauing, according to a chart from Statista. Decreased phone usage would lead to a decrease in overall streaming numbers even if the total number of subscribers stays the same. While this has no bearing on paid subscriptions since it’s not based on usage (although many in the industry would prefer it to be so), it does have an effect on the advertising-driven free tiers which still contain the majority of users across all platforms. Fewer hours spent listening means less exposure to the ads, which means less revenue for both the platforms and the music industry.

The fact of the matter is that as much as the music industry would like to think that music drives smartphone usage, that’s not the case. It’s social media. In fact music is organically wrapped around social media, so much so that even streaming services now try to incorporate a social aspect into their platforms.

Now just because teens are aware of a potential addiction to both their phones and social media, that doesn’t necessarily mean that a decrease in their use will happen. Addiction of any type holds a powerful grip on its abuser. Wanting to stop isn’t enough to make it happen, especially with all the peer pressure that teens experience. That said, the music industry should wake up to the fact that the happy days could potentially end sooner than anyone thinks, and begin to prepare for the next phase of post-growth.

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