Guest David Schulhof, Founder and CEO of MUSQ, discusses the MUSQ ETF, undervaluation of the music industry, Taylor Swift's impact, AI and blockchain in music, and more!
Streaming is the dominant revenue source in the music industry, accounting for 87% of music revenues, offering significant potential for growth in paid music services.
Advancements in AI and blockchain technology are transforming the music industry, opening up new possibilities for creativity, royalty distribution, and protection against deep fakes.
Deep dives
The Growth and Potential of the Music Industry
The music industry is currently experiencing substantial growth and innovation. Streaming has become the dominant revenue source, accounting for 87% of music revenues. With only 11% of mobile users currently subscribing to paid music services, there is significant potential for growth. As interest rates influence the purchasing power of music catalogs, the market remains favorable for investing. Concerts and live events also continue to thrive, providing artists with substantial income and fostering a shared experience for audience members. Additionally, advancements in AI and blockchain technology are transforming the industry, opening up new possibilities for creativity, royalty distribution, and protection against deep fakes.
Capturing the Global Music Ecosystem
The MUSQ ETF, designed to capture the entire music industry, offers investors a unique opportunity to gain exposure to the global music ecosystem. The fund comprises 48 publicly traded companies from various countries, including the United States, South Korea, Japan, and several European nations. Covering five main segments—content streaming, live music and ticketing, equipment and technology, satellite and radio—the fund presents a diverse range of investment opportunities. With a focus on companies deriving at least 50% of their revenues from music, the MUSQ ETF aims to provide investors with comprehensive access to the growing music industry.
The Under-Monetized Nature of Music
Music is considered one of the most under-monetized media assets, offering a significant value proposition for consumers. Compared to streaming video services, music subscriptions remain relatively cheap, presenting room for price increases. As streaming continues to grow and more people adopt paid subscriptions, music revenues are expected to double within the next six to seven years. Notably, the industry is recession-resistant, providing a more affordable option for entertainment during economic downturns. Additionally, the resurgence of vinyl and advancements in AI and blockchain technology contribute to the industry's overall growth and potential.
The Impact of Superfans and Music Derivative Uses
Superfans play a crucial role in driving revenue in the music industry. These dedicated fans are willing to pay a premium for concert tickets and merchandise, further contributing to the success of artists and the overall industry. Moreover, music offers numerous derivative uses, such as biopics, documentaries, and movie soundtracks, creating additional revenue streams. Advancements in technology, including AI and blockchain, are enhancing the creative process and allowing for new ways to interact with music. With the industry constantly evolving, the MUSQ ETF provides a comprehensive investment opportunity for those looking to capitalize on the growth and potential of the music industry.
On today's show, Michael and Ben are joined by David Schulhof, Founder and CEO of MUSQ to discuss: what the MUSQ ETF is comprised of, whether or not the music industry is undervalued, the affect Taylor Swift is having on the economy, how AI and blockchain technology might impact the music industry, and much more!
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