Business News Labels & Publishers Retail

More consumption and cash in 2018 – it’s your year-end record industry stats

By | Published on Thursday 3 January 2019

George Ezra

2018 was another year of super impressive if slightly meaningless big numbers for both recorded music and entertainment retail at large in the UK.

91 billion audio streams were delivered. The equivalent of 143 million albums were sold or streamed. Vinyl LP sales topped 4.2 million. The retail value of musical discs, downloads and streams was £1.33 billion. And across the board entertainment retail in its various manifestations generated £7.53 billion.

The greatest showman of the year was George Ezra. Although really it was ‘The Greatest Showman’.

But I suppose what really matters is that all the streaming and overall figures were up, up, up, whether you prefer your year-end stats to be consumption-centric – as provided by record industry trade body the BPI – or based on cold hard cash in the (possibly virtual) till – as provided by the UK’s Entertainment Retailers Association.

According to the BPI and Official Chart Company’s consumption figures, the total number of audio-streams delivered on platforms like Spotify and Apple Music across the year – ie the 91 billion stat – was 33.5% up on 2017. Or, if you prefer, though I’m not quite sure why you would (but someone’s done the maths anyway), 2350% up on 2012.

With the big streaming services still adding new subscribers all the time, it’s expected that that stat will top 100 billion this year.

When it comes to the always slightly bewildering equivalent album sales figure – the one that magically mashes together CD sales, downloads and streams – the 142.9 million stat constitutes a 5.7% rise year-on-year.

Which is impressive given last year didn’t have a blockbuster release quite on the level of Ed Sheeran’s ‘Divide’ (as in 2017) or Adele’s ‘25’ (as in 2015/6), though that stat does also mop up the aforementioned streaming boom, so the increase perhaps isn’t surprising.

The vinyl revival marches on, though increases are perhaps predictably slowing, with consuming music via twelve inch discs still a niche pursuit, accounting for 3% of consumption overall, compared to 22.4% for CD and 63.6% for streaming.

Still, the consumption of vinyl rose again in 2018 by 1.6% to reach those 4.2 million units. And if you want another slightly-random long-term increase stat, that’s a 2000% rise since the format’s low point back in 2007.

But what about the money? Well, according to ERA, which measures retail value (rather than wholesale value), recorded music generated £1.33 billion in the UK last year, which is up 8.9% overall.

Streaming accounted for £829.1 million (up 37.7%), while downloads brought in £122.6 million (down 25.7%) and physical products combined generated £383.2 million (16.6% down). Entertainment retail at large – ie also including video and gaming – brought in a grand total of £7.53 billion, up 9.4%.

All three strands of entertainment retail – music, video and games – were up, in all three cases because of increases in digital income, which compensated for ongoing declines in physical sales.

Though physical remains a significant secondary revenue stream, and in terms of recorded music still accounts for more than a quarter of both consumption and retail income. ERA also reckons that the biggest selling albums in particular still rely heavily on physical sales.

Of course, more attention than normal is being given to the physical side of entertainment retail at the moment, given the music industry is returning after the festive break with its biggest high street partner – ie HMV – in administration.

It remains to be seen what happens to the HMV business, but if all 120+ stores disappear, that could have a big impact on physical sales overall in the UK. And therefore the viability for labels to continue manufacturing physical product for general release, as opposed to just special edition and premium packages, possibly for sale direct-to-fan.

Beyond the surviving network of independent record stores, there are still other non-specialist retailers stocking CDs of course. Though when it comes to the supermarket disc buyer, artists have been having to compete with a bunch of popular movie soundtracks of late.

That includes the OSTs for ‘A Star Is Born’ and the second ‘Mamma Mia’ film, not to mention the ever-present seemingly-unstoppable official soundtrack to ‘The Greatest Fucking Showman’. Even George Ezra couldn’t outperform that record in the end-of-year album charts, despite the ‘Showman OST’ being originally released for the Christmas market in 2017.

And there you have it. Your handy helping of big numbers for the British recorded music year that was 2018. And now, as a prize for making it this far, here are some quotes.

BPI boss Geoff Taylor: “2018 saw another strong performance from the British recorded music business as consumers deepen their engagement with music in its myriad forms. Complemented by collectible physical formats on vinyl, CD and super deluxe box sets, streaming services are enabling more people to discover, enjoy and instantly share music they love”.

“But, 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. If these risks are avoided, British music remains poised for further growth”.

ERA boss Kim Bayley: “On a market level these figures are a stunning testament to the investment and innovation of digital services who have transformed the fortunes of an entertainment industry many had thought was doomed by the internet and piracy”.

“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. 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”.