The bottom dropped out of the live music industry in 2020 due to Covid-19, but it’s becoming clear that the recorded music industry weathered the storm thanks to streaming subscription revenues, whose growth continued.
US industry body the RIAA’s annual figures for 2020 are the latest evidence, revealing that the retail value of recorded music revenues grew by 9.2% last year to $12.2bn, while the wholesale (trade) value for labels grew by 8.9% to $8bn. Streaming accounted for $10.1bn of the retail total – an 82.8% share.
That’s 13.4% year-on-year growth for streaming revenues in the US, although note that 2020’s figures included music licensing revenues from Facebook for the first time – no, sadly they weren’t broken out as an individual figure.
On-demand music subscriptions grew by 14.6% to $7bn in the US last year, with an average (over the year) of 75.5 million Americans subscribing. That figure doesn’t include ‘limited-tier’ subscriptions like Pandora Plus or Amazon’s Prime Music, which accounted for another $724m, and it counts family plans as a single subscription.
There was a Covid-19 hit to ad-supported music revenues, but it was a deceleration of growth rather than an actual decline. Ad-supported music revenues grew by 16.8% year-on-year to $1.2bn in 2020 – “compared with an average of nearly 30% growth rate in the three years prior”. Note, this is the category the Facebook deal fell into, boosting the 2020 total.
There are some physical stats worth thinking about too. US vinyl sales grew by 29.2% to $619.6m last year, making the format more lucrative than CD (down 23.4% to $483.3m). What’s more, vinyl wasn’t far off overtaking the retail value of music downloads: $632.3m combined for track and full album downloads. Quite the renaissance for a format that predates the CD and download eras.
The figures, particularly around streaming subscriptions, are very good news for labels and the industry. However, they also add more fuel to the debate – in the US and elsewhere – around how the revenues from the industry’s streaming rebirth are flowing through the system to musicians.
Image by JStone / Shutterstock.com
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