Praise the DJ, because vinyl is the only thing propping up music sales right now. Sales of vinyl surge while mp3s continue their decline and streaming takes a bite out of everything…
The Recording Industry Association of America released their report on music sales for the first half of 2015 on September 21st, which continues to show “a business undergoing an enormous transition,” according to RIAA Chairman and CEO Cary Sherman.
The News and Notes on 2015 Mid-Year RIAA Shipment and Revenue Statistics shows that digital revenue accounts for a whopping 76% of the overall market by value – up 5% since the first half of 2014.
Some takeaways from the report:
Of digital revenue, streaming continues to grow apace. In the first half of 2014, streaming represented $834 million in revenue versus $1 billion in revenue at the midpoint of 2015. Drilling deeper, SoundExchange distributions (largely from fees from Internet streaming) grew 20% to $387 million. Revenue from subscription services grew from $383 million to $478 million. “On demand ad-supported streaming” (i.e., Spotify’s free service and similar plans) grew 27% year over year to $163 million – a surprisingly low figure, all things considered.
Streaming surpassed sales of physical media for the first time in 2015. Streaming now represents 32% of music industry revenues, while physical media accounts for 24%. The chief loser in physical media were CD albums and singles, which declined by 31% and an astonishing 81% in value from the first half of 2014 to the first half of 2015, respectively.
Downloads now represent the largest portion of revenue from recorded music, totaling 40% of overall revenue. This number is shrinking, however, as streaming cannibalizes MP3 sales. The industry sold 12% fewer mp3 in the first half of 2015 compared to last year, representing a decline of 9.4% in revenue.
Interestingly, mp3 album sales are actually up – 5% by units sold and 4.2% in revenue. It makes sense when you think about consumer behavior, as many streaming services make it far more difficult to listen to complete albums.
Vinyl continued its tremendous upward swing, though it wasn’t enough to offset the decline of the CD and mp3 single. Vinyl LPs and EPs sold 9.2 million units in the first half of 2015 – a 43% increase over the first half of 2014. Revenue was up to $222 million, a gain of 52%. Vinyl now represents 30% of all physical shipments by value. Now imagine if labels were able to press as many vinyl records as they wanted to…
The streaming figures are likely to receive a fairly large bump when the RIAA’s second half survey is released in early 2016, as AppleMusic’s debut occurred on literally the last day of the 1st half of 2015 and thus is not represented in these figures.
The News and Notes on 2015 Mid-Year RIAA Shipment and Revenue Statistics can be read here.