A new report from the the Recording Industry Association of America (RIAA) examining year-end revenue in the music industry shows and interesting mix of both promising and troubling figures. Perhaps the most important statistic to glean from the report is the absolute domination of streaming as a percentage of total recorded music revenue: seventy five percent.
Streaming services such as Spotify, Apple Music, Pandora make up 75% of the $9.8 billion total revenue from recorded music in 2018. totalling $7.4 billion. It also accounts for “virtually all the revenue growth for the year.” Digital downloads declined for the sixth year in a row, with permanent downloads of albums dropping 25% and individual track sales falling 28%. Revenues from shipments of physical products also decreased, down 23% from 2017.
Paid subscriptions to streaming services continues to grow, however, reaching 50 million combined between all services for the first time ever. The figure increased 42% over 2017, demonstrating a bright future for streaming.
However, as subscriptions to streaming platforms increasingly becomes the dominant source of revenue, artists, labels, and industry professionals must always remain vigilant and cognizant of return rates from these services and how they affect a team’s bottom line. See here for a list of payouts from streaming services, updated for 2019.
Check out the full report here to see the full scope of revenue-generating activities within the music industry.