US dollars money

US labels body the RIAA published its mid-year figures for 2022 yesterday, revealing that the retail value of recorded music in the US grew by 9.1% to $7.69bn in the first half of this year. Meanwhile, wholesale (trade) revenues grew by 8% to $4.9bn.

The retail figures included 9.4% growth in paid subscriptions to streaming services, which were worth $4.51bn in the first half of 2022 – 58.6% of the total. Factor in limited-tier subscriptions (up 16.6% to $525m), ad-supported on-demand streaming (up 16.4% to $871.5m) and other forms, and streaming now accounts for 84.2% of the overall market.

This is all positive news, but what about the much-discussed concerns that streaming growth is slowing? In percentage terms, yes. Looking back at recent RIAA mid-year reports, the growth of paid subscriptions has fallen steadily: 49.5% in 2017; 36.5% in 2018; 29.8% in 2019; then 13.7% in 2020 as Covid-19 hit.

The 2021 mid-years saw a bounceback effect with 24.9% growth in US subscription revenues, which is one factor in the slide in growth to 9.4% this year. Which is at least growth rather than shrinkage: against a backdrop of economic uncertainty, more people are taking out new music subscriptions in the US than are cancelling them.

Percentage growth isn’t the entire story, of course. Paid subscriptions generated $387.6m more revenues (retail, still) in the US in the first half of this year than in the comparable period last year. Even from a bigger base, that’s well down on the $752.5m added in the first half of 2019 compared to the first half of 2018 – the last pre-Covid comparison available.

Still… The US may be the biggest recorded music market, but it’s not expected to be the key driver of music subscriptions (and thus overall revenues) in the coming years. Earlier this year, Midia Research claimed that emerging markets will represent the majority of music subscribers by 2026, for example.

Also, the RIAA figures just cover recorded music and its key formats/collecting sources, and this is clearly just one piece of the picture for musicians. Live and publishing, most obviously, but also their (still patchily-tracked) D2C businesses, and some of the emerging areas: tips economies, superfan subscriptions, new kinds of product from virtual merch to (whisper it!) NFTs and more.

All of which is to say: figures showing the growth of recorded music are important, especially when they come from the world’s largest market, but there’s a bigger picture around how the people making that music might be growing their own incomes.

Labels may not play as big a role in that as they do for recordings, although they would like to play a role, and are building out teams, technology and partnerships to make that case to artists. Slowing growth in streaming revenues is one of the drivers behind that trend, as well as fuelling their efforts to license new partners in fitness, social, gaming and other sectors.

Recorded music figures remain an important barometer for that side of the industry, and that’s why tracking the trends and discussing the challenges revealed is key. But it’s just as vital to remember that in the next decade, perhaps more than ever before, these figures are just the start of the tale of how musicians make a living, rather than the entire story.

The slowdown in streaming growth is encouragement to continue fleshing out that narrative, rather than a cause for panic.

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