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Business News Digital Labels & Publishers
RIAA boss celebrates “rising excitement and optimism” as US recorded music revenues grow again
By Andy Malt | Published on Friday 1 March 2019
More than 50 million Americans are now paying to stream music, fuelling the third straight year of double-digit growth for recorded music revenues in the US. So says the Recording Industry Association Of America’s annual report on such things. And it should know.
“There is reason for buoyed optimism among those who help create music”, says RIAA CEO Mitch Glazier alongside his organisation’s 2018 stats pack. “Recognising that there is more work to do, labels remain focused on building an ecosystem where every responsible player does its part to ensure that innovation continues to thrive, fans continue to be connected and engaged, and everyone is paid fairly for their work”.
In 2018, US recorded music revenues increased by a whole billion dollars, to $9.8 billion. That – the trade body is keen to point out – is less than a billion dollars away from the amount of money coming in to the US record industry back in 2007. You all remember 2007, right, when everyone was really happy with the amount of money recorded music was generating? Such happy times.
The boost last year was largely – basically entirely – down to streaming, with revenues from these digital platforms increasing 30% year-on-year to $7.4 billion. That means streaming revenues now account for 75% of all recorded music income in the US.
Obviously entirely positive, that would all only be of concern if you happen to think that having one entire industry (the record industry) propped up by another (the streaming business) that is best known for making consistent losses is somehow worrying. And who thinks that? Not me. Didn’t you hear that Spotify is profitable now. Well, it was in one quarter last year. Sort of by accident. An achievement published alongside a prediction of more losses in 2019. But still!
Adoption of much more lucrative paid-for streaming is on the up, though. There was a 42% increase in 2018, up to 50.2 million paying subscribers from 35.3 million in 2017. And that is positive – streaming is a numbers game after all and if the services are ever to start turning a profit there needs to be lots of people willing to pay for it.
We shouldn’t entirely dismiss ad-funded streaming, mind. Revenues from free services, including YouTube, were up 15% in the US last year too. It’s still much less lucrative than the paid-for services though, bringing in just $760 million. That’s 8% of revenues from services that account for around a third of all streams.
Although Glazier was very upbeat in his statement announcing the stats report, he did take time to put in a veiled dig at YouTube and also the continued problem of stream-ripping, which some also see as partly YouTube’s fault.
“Stream-ripping, and a lack of accountability for many big tech companies that drive down the value of music, remain serious threats as the industry strives for additional growth”, he says. But, he adds, having noted that investment in new artists at the major labels is up dramatically: “You can feel rising excitement and optimism within the halls of the record labels, and it’s a moment worth celebrating”.
Alright, you can pull one party popper, then get back to work. You can also read the full report here.
