Recent findings reveal that the market for generative AI and stem separation tools is experiencing an extraordinary growth trend, with revenues projected to soar by 651% from 2023 to 2025. The IMS Electronic Music Business Report 2025/26 indicates these tools will generate an impressive 333 million USD in 2025 and attract 63 million monthly active users, significantly transforming the creator economy.
Authored by Mark Mulligan of MIDiA Research, the IMS report emphasizes that AI technologies are catalyzing a major shift in music production. In contrast, revenues from traditional music software—excluding Digital Audio Workstations (DAWs)—have seen a decline during the same period. This trend suggests a realignment in creator tools focusing around AI-driven workflows.
Importantly, the report highlights that AI is most impactful on the creation process rather than on consumption patterns. While much public discourse has centered on issues like copyright and streaming, the ability of generative tools to empower users—especially those who may never have used a DAW before—is equally noteworthy.
Stem separation has emerged as an essential tool for DJs and producers, allowing fans to isolate vocals, drums, and melodies from virtually any track. Generative platforms also enable users to craft original compositions based on simple text prompts, both of which contribute to the remarkable 651% growth.
The figure of 63 million monthly active users positions AI music tools alongside mid-tier streaming services. However, revenue per user remains relatively low compared to subscription-based music services. This disparity suggests there is potential for price adjustments as these features continue to develop.
In summary, the data illustrates that AI is rapidly transforming the landscape of electronic music production. The authors of the IMS report indicate that this represents a significant shift for the creator economy, with dance music leading the charge due to its strong production-centric culture. For the full report, please visit IMS.
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