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RIAA stats show record industry mainly COVID immune thanks to streaming
By Chris Cooke | Published on Friday 11 September 2020
New figures from the Recording Industry Association Of America confirm that – while some recorded music revenues have been hit by the COVID-19 shutdown – because subscription streaming is by far the biggest revenue generator in markets like the US, the record industry at large is much more immune to the commercial impact of the virus.
As a result, total US record industry retail revenues for the first half of 2020 were up 5.6% year-on-year to $5.65 billion. That was thanks to a 13.7% increase in premium streaming revenues, which now account for 67% of total revenues.
The RIAA says that about 72 million Americans are now signed up to a premium streaming service (not including those subscribed to what the trade group calls ‘limited tier’ services, which come with catalogue or functionality limitations).
Revenues generated by ad-funded streaming services were also up, although the impact of COVID-19 was felt in that domain. With the ad industry wobbling as the COVID shutdown went into effect, the revenues generated by free streaming services grew by 2.7%, which is a much slower growth rate than in previous years.
Physical sales overall continued to decline, with the RIAA reckoning that the latest significant slump in CD sales specifically was COVID-related. That slump was sufficiently significant that vinyl is now generating more revenue than CDs for the first time since the 1980s. Vinyl sales also took a knock as COVID shutdown went into effect, but still grew 3.6% over the full six months. CD sales slumped 47.6%.
Download sales were down, though that’s a constant trend these days and not really COVID-related. Sync revenues were affected by the pandemic though, as the TV and movie industry went into shutdown. However, they are a very small part of the recorded music market anyway, so a slight wobble has less of an impact.
The other key revenue streams definitely impacted by COVID – AM/FM radio and public performance income – don’t really factor in the US because a limitation in American copyright law means these revenue streams don’t exist for artists and labels anyway.
Another thing impacted by COVID is the RIAA’s own response to these stats. In recent years official record industry figures have generally been accompanied by a customary quote along the lines of “aren’t we doing well, that’s all because the labels keep investing and innovating, but you know what, we should be doing better, fucking YouTube, hey politicians, do something about the evil safe harbour will you?”
But with other strands of the music industry really hurting because of COVID – and seeking support for those other strands the really lobbying priority just now – the RIAA knows that a more muted response is required. And that’s what we got.
“These are historically difficult times: the live music sector is shut down; studio recording is limited; and millions of Americans are out of work across the broader economy”, RIAA boss Mitch Glazier noted.
“While we’re pleased that the years of hard work and resources we’ve invested in streaming are driving growth in paid subscriptions, today’s report demonstrates just how much work remains to achieve a sustainably healthy music ecosystem for both music creators and fans”.
He concluded: “We must continue working to help sustain live music and venues, support gig workers and session musicians, and ensure fair pay for music on all digital platforms. Despite all the challenges from the pandemic, one thing clearly hasn’t changed – fans still love music”.
