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Streaming overtakes physical sales for Universal Music


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This is not a surprising milestone, but a notable one nonetheless: Universal Music Group made more money from streams of its recorded-music catalogue in 2016 than it did from physical sales.

According to parent company Vivendi’s financial results, UMG’s recorded revenues from streaming grew by 55.5% to €1.48bn ($1.64bn) in 2016, while its physical sales dropped by 13.1% to €1.23bn ($1.36bn).

With download sales dropping 26.1% to €755m ($835m) last year, the tipping point where streaming revenues outweigh physical and digital sales combined is approaching fast – perhaps even in 2017.

Overall, Universal Music Group’s recorded-music revenues grew by 1.8% to €4.19bn ($4.63bn) last year. Streaming accounted for 35.4% of that compared to 29.3% for physical, 18% for downloads and 17% for licensing and other income streams – so the latter overtaking downloads looks like being another little tipping point for UMG in 2017.

The overall 1.8% growth gives us an early glimpse at what the bigger picture for the global industry may look like when the IFPI releases its 2016 figures later in the year: small growth, but considerable optimism that this growth is now sustainable, and may even accelerate.

Universal’s publishing division UMPG also had a good year in 2016, posting revenues of €792m ($876m) representing a 4.8% increase on the previous year. The company cited growth in digital, sync and performance income.

Stuart Dredge

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