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BPI and ERA figures reveal music’s growth in the UK in 2018


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British industry bodies the BPI and ERA have published figures showing how the UK’s recorded-music market grew in 2018.

One of the headlines: an 8.9% growth last year in recorded-music sales to £1.33bn (around $1.68bn). It will come as no surprise that streaming was key to this.

ERA’s stats show that spending on streaming subscriptions in the UK grew by 37.7% in 2018 to £829.1m – more than 62% of the total figure. Physical sales declined by 16.6% to £383.2m, while music-downloads sales fell by 25.7% to £122.6m.

(It’s important to keep in mind that these are ‘spending’ figures: money spent by Brits on recorded music. ERA’s stats don’t include advertising revenues for streaming services.)

ERA noted that spending on vinyl grew by just 1.6% in 2018, as part of that physical stat. But the body also talked up the continuing importance of physical formats, even though they’re now just 28.7% of overall music spending in the UK.

“Significantly in this week of HMV’s news, however, the data shows that if you want a real mass market hit, you need the reach and convenience of physical formats,” said CEO Kim Bayley, following a week that has seen retail chain HMV go in to administration.

“In music even today more people buy CDs than pay for streaming subscriptions and in video more homes have DVD players than subscribe to all the leading video services put together. The challenge for physical retailers is to tap into this huge market of occasional buyers.”

Music Ally followed up on that CDs versus streaming figure: according to ERA’s tracking study, 22% of Brits are buying CDs, compared to 20% who have a streaming subscription.

ERA’s stats show that some of the biggest UK albums in 2018 still skewed towards physical in their calculated ‘units’ for chart purposes. For example, George Ezra’s ‘Staying At Tamara’s’ was 70.5% physical, while albums from Michael Buble (93.3% physical), Take That (92.9%) and various NOW compilations were even higher.

In contrast, Drake’s ‘Scorpion’ and Post Malone’s ‘Beerbongs & Bentleys’ were hugely digital – 93.1% and 91.9% respectively. The biggest album of all in the UK last year was the soundtrack to ‘The Greatest Showman’, which was 48.7% digital and 51.3% physical in its units total.

“Streaming services were once again the star performers in the UK music market in 2018, but the continuing strength of physical sales at the top end of the chart means that unless you are a hip-hop artist, the only way to have a really big album is to generate CD sales as well as streams,” said Bayley.

Over to the BPI, whose 2018 stats measure UK music consumption – the number of sales and streams for recorded music last year, rather than how much money was spent on them.

The headline figure here is 5.7% – that’s the year-on-year growth in ‘album equivalent sales’ (AES) – a metric under which 10 single-track sales is a ‘track equivalent album’, and 1,000 audio streams a ‘streaming equivalent album’. The AES total for 2017 was 135.1m, and for 2018 it was 142.9m.

(Within this, streaming-equivalent albums – SEAs – grew by 33.5% to 90.9m, thus accounting for 63.6% of all consumption – this has grown rapidly from 12.6% in 2014 to 22.1% in 2015, 36.4% in 2016 and 50.4% in 2017. Converting that SEAs figure back into individual streams gives you 90.9bn streams in the UK last year.)

What’s missing from these figures? YouTube. The BPI’s streaming metrics focus on audio services only, rather than video. While there’s a logic to this, it does mean the statistics don’t give the full picture on how Brits (particularly younger people) were actually consuming music in 2018.

BPI boss Geoff Taylor delivered a warning in his official statement accompanying the figures, focusing on the UK’s imminent exit from the European Union as well as the familiar arguments about YouTube’s ‘value gap’.

“As we are already seeing, including with the news that HMV has gone into administration, continuing growth could be put at risk if a hard Brexit further harms consumer confidence or Government fails to ensure that all platforms using music pay fairly for it,” said Taylor. “If these risks are avoided, British music remains poised for further growth.”

One final point: ERA’s announcement focused on the bigger picture of ‘entertainment’ – music, games and video – and thus offers some context for the scale and growth of recorded-music spending in the UK.

Remember, music spending grew by 8.9% to £1.33bn last year, but it was outstripped by games and video. Video spending – that’s DVD and film/TV download sales but also subscriptions to services like Netflix – grew by 10.1% to £2.34bn.

Meanwhile, games spending in the UK grew by 9.1% to £3.86bn. That means the games market isn’t far off being three times bigger than the music market, and with a 51.2% share of overall entertainment spending in the UK, it’s bigger than music and video combined.

Stuart Dredge

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