It’s not news that the music industry is changing. It changed when Phillips first released cassettes in 1962 (with every new blank media generating muttering over piracy), and again when we realized we could use the internet to listen to, download, and share music (and so many times in between).

Some parts of the industry have been willing to evolve, and some have been more reluctant. But whether you embrace it or not, over the past 50 some years, traditional forms of monetization in the music industry have changed or disappeared altogether, with new mediums popping up in their place.

Music as a whole is still making money. In 2015, the global music market was worth $33.87 billion and is expected to reach a value of $43.39 billion in 2020.

But talking about the music market nowadays means talking about four very distinct industries: Live music, digital music, physical music, and music publishing. To get the full picture, you have to look at how each segment is behaving individually, and with respect to the other categories.

Challenges to music industry revenue

We’re not going to get into details on these segments right now—you’ll have to see our full report for that. Instead, we want to take a look at challenges that are impacting the music market as a whole.

Declining physical music sales

Along with piracy, declining physical sales is an area of the music industry that been discussed to death, but we would be remiss to not mention it here. The sales of physical music accounted for more than 60% of the global music market in 2010. In 2015, it had plummeted to just under 15%. Also in 2015, sales of physical records equaled just $4.98 billion, whereas digital sales far outstripped that, at $7.94 billion.

Lack of ownership

One argument that you tend to hear from people who are reluctant to adopt music streaming services is that they don’t like the idea of their collection just existing in the cloud somewhere.

And the lack of physical ownership is enough of an issue to impact adoption of these services, leading many users to download music from other (sometimes illegal) sources, and impacting overall market growth.

Intense competition

The global music market is highly competitive with independent publishing houses, digital music service providers, concert ticket suppliers and even individual artists fighting over consumers.

Overall, choice is a good thing. But when we’re talking about markets and how they work, all this choice has the effect of splitting the vote and dividing up consumers’ disposable income between both large and small entities. Traditional publishing houses tend to come off on top here because of notoriety, popularity, trustworthiness, and sheer marketing dollars. Generally speaking, they have better distribution channels to enhance the visibility and reach of their artists and albums.

Therefore, new entrants and smaller vendors can have a hard time finding their place in the shadow of these giants.

While it may seem odd to highlight challenges in a market that is, overall, doing quite well, it helps give context to the ebb and flow of money in the music industry: Declines in physical media gave way to the rise of digital, which evolved into streaming services. On the other hand, concerts and publishing houses have seen less volatility and continue to anchor the market, with the former still providing the bulk of revenue.

For more information on these challenges, as well as key trends and a complete breakdown digital music, physical music, concerts, and music publishing, check out Technavio’s new report.