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US record industry saw 9.2% revenue growth during COVID year

By | Published on Monday 1 March 2021


If you’re looking for more figures to confirm that, while the music business at large had its most challenging year in history, the record industry was still very much in growth mode throughout 2020, look no further than the latest stats pack from the Recording Industry Association Of America.

Recorded music revenues in the world’s biggest recorded music market grew 9.2% over 2020 reaching an estimated retail value of $12.2 billion. It was the US record industry’s fifth consecutive year of growth, led – of course – by the ongoing streaming boom.

That said, RIAA boss Mitch Glazier – in his accompanying blog post – remembers to keep his stat bragging to the minimum, knowing that plenty of artists, songwriters and music companies outside the digital music sector are still facing significant hardships as the COVID shutdown extends.

“The necessary cancellation of most live performances has deeply impacted artists and so many other music professionals – from touring musicians to road crews to supporting businesses like catering, trucking and promotion – and left scores of landmark venues on the brink of collapse”, he writes. “COVID-19 restrictions challenged the newly resurgent retail record store business with occupancy caps and closures nationwide”.

While the record industry was much less impacted by COVID than all the other strands of the music business, Glazier says his organisation’s members have done their bit to help the wider community. “I’m proud of all that our members have done to help the music community and our American family weather this historic crisis”, he says. “Labels have provided direct financial support to employees and artists in need and, turning outward, have done everything from delivering personal protective equipment to health care heroes, to funding relief programmes”.

“As the crises deepened and stretched on”, he continues, “we’ve stood shoulder to shoulder with virtually every segment of our industry, including by fighting to ensure artists and songwriters were included in support and relief programmes, to save live music venues that are central to our nation’s culture and our community’s economy, and provide resources like with critical information on benefits, grants and other relief available to America’s artists, songwriters and other music professionals”.

With all that said, what about all these positive digital music stats? Streaming now accounts for 83% of US recorded music revenues, though that category covers a wide range of services. As well as free and premium streaming platforms, also in the streaming category are user-generated content and video-sharing apps, and online and satellite radio services, including those who pay royalties via the US collecting society Sound Exchange.

Glazier notes the diversifying digital music market, and that monies from social media like Facebook/Instagram and fitness app Peloton are also now helping streaming revenues – and therefore the record industry at large – to continue to boom. Though, he adds, premium subscriptions still remain the biggest revenue generator overall.

“In 2020, paid subscriptions grew 15% to $7.7 billion, making up almost two thirds of total recorded music revenues”, he writes. “Combined, paid streaming services added more US subscriptions in 2020 than in any previous year”.

“That paradigm shift explains why record companies today are so determined and vigilant in fighting to ensure that the platforms that use music – and profit from its use – take a licence and pay for it – standing up for a core first principle that creators should be fairly paid everywhere their work is used and reflecting consumers’ fundamental agreement with that principle”.

In case you wondered who is the target in that remark there – ie who are these platforms still using and profiting from music without properly licensing it – well, Glazier names and shames Twitter and Triller. The latter’s inclusion is interesting in that it had been working with all three majors, until Universal Music bailed on the platform last month accusing the Triller company of “shamefully withholding payments owed to our artists and refusing to negotiate a licence going forward”.

Beyond streaming, the US record industry’s other revenues are made up of physical products (9%), downloads (6%) and sync (2%). While estimated retail revenues were up 9.2% to $12.2 billion, estimated wholesale revenues – ie what was collectively received by the labels, distributors and artists – were up 8.9% to $8 billion.

“Most Americans couldn’t be more ready to turn the page from 2020 into a new year as vaccines promise recovery, renewal, and hope”, Glazier concludes. “For performing artists and musicians, getting back on stage and reconnecting with audiences and fans simply cannot come too soon”.

“And while today’s release provides a bright spot for creators and describes a vital and growing streaming ecosystem for everyone with a stake in it, there’s a long way to go before we reach the far side of the COVID-19 calamity. As a music industry – as a united community – the work of recovery, rebuilding, and relief must and will continue”.