A new report has emerged, aiming to shed light on the possible influence of generative AI on the music industry's revenue. Photo Credit: Possessed Photography

Unprecedented Technology and Its Consequences

Just how significant will the impact of generative AI be on the music sector? A study is delving into the potential multibillion-dollar implications for creators and rightsholders. This newly released (and previously announced) study comes from the International Confederation of Societies of Authors and Composers (CISAC), which entrusted Paris-based PMP Strategy with conducting the underlying research.The breakdown focuses on both the music and audiovisual realms, aiming "to assess the economic weight and impact of" AI, rather than gauging the immediate job-related fallout.From this starting point, with several relevant legal actions and initiatives already in motion, the findings have the potential to "inform and enlighten the debate on remuneration mechanisms" for the music space, as per CISAC.In terms of pertinent background details, the report is based on estimates made through "a qualitative and quantitative methodology," taking into account "interviews and workshops with over 50 industry professionals."

Analysis of Generative AI Music Outputs

Digging deeper into the analysis, it is estimated that the yearly market value of generative AI music outputs could reach a staggering $16.82 billion/€16 billion in 2028, up from approximately $1.05 billion/€1 billion in 2023.As currently projected, the majority of the 2028 sum would come from AI tracks on traditional streaming platforms, followed by B2B AI music providers and then streaming services dedicated to AI listening.However, perhaps the most remarkable aspect of the streaming prediction is that AI-generated tracks may account for approximately one-fifth of streaming platforms' revenue by (not in) 2028.Furthermore, the same machine-made songs could make up "around 60% of music libraries revenues," as reported.

Income Implications for Music Creators

Unsurprisingly, the not-so-ideal situation may lead to a decrease in income for the (human) talent actually creating music. According to the findings, up to 24% of "creators' revenues are at risk in 2028" when comparing the year's figures to a no Gen AI scenario.This includes a concerning possible 2028 decline of 30% for creator revenue from digital sources, with streaming being a chief contributor.The overall falloff would amount to a loss of over $10.51 billion/€10 billion between 2024 and 2028, with $4.20 billion/€4 billion attributed solely to 2028. Meanwhile, the study's organizers anticipate that generative AI music services' revenue might reach the same level (€4 billion) in 2028.

Legal and Litigation Imperatives

Though it may seem obvious, the report's hard numbers, which largely align with those disclosed in an August breakdown of the same area, highlight the urgent need to address generative AI through laws and litigation.Related courtroom confrontations are progressing in both the U.S. and Europe, where the implementation of the multifaceted AI Act remains a key focus. In the U.S., lawmakers have introduced artificial intelligence bills such as the NO FAKES Act and the newer TRAIN Act, but their legislative progress has been slow to date.