YouTube Music Dominates Music Market...Melon Falls to 31.7% While Spotify Grows Threefold

The landscape of South Korea’s music streaming market is undergoing rapid changes. According to the “2025 Music Industry White Paper” released by the Korea Content Agency this year, 37.6% of 2,155 respondents chose YouTube Music as their primary music platform over the past year, starting from May of last year. This represents a significant increase from 24.2% the previous year, and analysts attribute it to the agency categorizing YouTube and YouTube Music as separate items. Melon, once the largest domestic music platform, dropped to second place with 31.7% usage. Genie followed at 9.0%, followed by Flo at 5.6%. The foreign service Spotify recorded 5.2% usage. Spotify’s user share increased by nearly threefold, rising from 1.7% last year to 5.2% this year, reaching a level that threatens domestic services. Changing preferences among music platform users are also becoming evident. Over half of users, 55.0%, reported having changed their music platform within the past year, up by about 10 percentage points from 45.9% last year. The most common reason for switching was “high subscription fees” at 42.7%, followed by “changes in affiliated services due to mobile carrier changes” at 10.5% and “unconvenience of the service” at 9.8%. Behind these market changes is a shift from chart-based to algorithm-driven systems. Melon’s charts once served as the absolute benchmark for South Korean pop music trends. In October 2020, Melon had 5.05 million Android users, surpassing the combined total of Genie Music’s 2.29 million users and YouTube Music’s 1.95 million users. However, it lost first place to YouTube Music in 2022. By August this year, Spotify’s user base reached 4.24 million, pushing it ahead of domestic platforms Genie Music (2.57 million users) and Flo (1.76 million users). Ironically, the decline of Melon was caused by its own charts. Real-time charts turned into battlefields for idol fanbases’ streaming battles, and their credibility plummeted due to controversies over music pre-ordering. In response, Melon eliminated real-time charts and replaced them with a Top 100 chart, but user fatigue had already accumulated. Meanwhile, foreign platforms succeeded in differentiating themselves through personalized algorithmic recommendations. Spotify offered benefits tied to Naver Membership and introduced an ad-supported free tier, while YouTube Music expanded its offerings by including video content as part of its music service. This method of recommending music based on individual preferences was praised for providing fresher content compared to popularity rankings based on official charts. Google plans to launch YouTube Premium Lite in South Korea first in the world, featuring ad removal, background playback, and offline storage functions. Although platform officials predict that the impact of this new tier will be limited, they note it could serve as an incentive for users who do not currently use YouTube Music. Domestic platforms are also adapting to these changes. Melon launched a new concert series titled “The Moment” for membership holders and operated pop-up stores in collaboration with Coldplay, ILLIT, and NMIXX. Spotify operates “Spotify House,” an experience space where fans can watch performances by famous artists, and it held the indie music event “Fresh Finds” together with the CJ Culture Foundation.