Domestic Digital Music Market Reaches 1.8 Trillion Won, Doubles in Four Years

KOMCA: "Creators Receive Only 10% Share, Lower Than Overseas"

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A recent study has found that the size of South Korea's digital music market has surpassed that of Japan, which is considered Asia's leading music market.

According to a music streaming market report released on May 22 by the Korea Music Copyright Association (KOMCA), which commissioned EY Hanyoung for accounting and consulting services, the domestic digital music market grew by 90.5%, from $692 million (approximately 954.8 billion won) in 2019 to $1.318 billion (approximately 1.8149 trillion won) in 2023. This figure combines both music streaming and downloads.

In particular, the streaming sector drove the market's growth. The streaming market surged by 95.6%, from $661 million (approximately 910.2 billion won) in 2019 to $1.293 billion (approximately 1.7805 trillion won) in 2023.

KOMCA stated, "As of 2023, the size of South Korea's digital music market has surpassed that of Japan, which remains in the 900 billion won range," and projected, "By 2027, the market is expected to expand to $1.695 billion (approximately 2.3325 trillion won)."

The global music market is also continuing its growth, rising from $18.8 billion (approximately 25.8556 trillion won) in 2019 to $28.6 billion (approximately 39.3335 trillion won) in 2023.

However, there are concerns that the revenue received by creators remains low. According to the report, the share of streaming revenue allocated to copyright holders is 12.3% in the United States, 16% in the United Kingdom, and 15% in Germany, but only 10.5% in South Korea. This is 1.8 to 5.5 percentage points lower than in major overseas countries.

KOMCA pointed out, "This is a poor environment compared to South Korea's reputation as the home of K-pop," and noted, "Major domestic streaming platforms have established a vertically integrated structure from production to distribution and sales, taking more than 83% of the revenue."

KOMCA also argued that the 'music copyright royalty win-win plan' implemented in 2022 has actually reduced creators' revenue. This policy excluded in-app payment fees paid to app market operators such as Google and Apple from the sales amount used as the basis for copyright royalty calculation, and this measure was extended for two more years last year.

A KOMCA official stated, "Protecting the legitimate rights of creators is the path to a sustainable ecosystem," and added, "We will actively respond to raise royalty rates and improve policies."