The Recording Industry Association of America released a report today that details how the music industry has grown in 2018, and while the data isn’t surprising — the world still isn’t buying records — the specific numbers are still fascinating. Turns out, streaming makes more money than physical CDs, digital downloads, and licensing deals combined.
Streaming in this context includes paid subscriptions to services such as Spotify and Tidal, but also digital radio broadcasts and video streaming services such as VEVO. It’s a broad category that nonetheless has made $3.4 billion dollars in 2018 so far, a total that amounts to 75 percent of overall revenue for the record industry.
The new user adoption rate for streaming is currently around 1 million new subscribers for streaming services per month, which is tiny compared to the number of people who actually listen to music, but that growth rate is still bigger than every other category of recorded music business.
Digital download revenues and physical purchases were down this year by 27 percent and 41 percent, respectively, continuing a general downward trend since the advent of online music sharing. Vinyl sales, which in recent years have once again become trendy, have increased in revenue in 2018 — but not enough to offset other more traditional forms of recorded music sales.
“The music streaming economy presents myriad new opportunities, but also its share of challenges too,” the RIAA writes. “According to Nielsen, more than 70,000 different albums were released by mid-year. Finding an audience amongst an extraordinary range of music choices, competing for the user’s attention against other entertainment options on the ubiquitous smartphone, and being prominent on dozens of different digital platforms is ... critical for success.”