Music revenue rose 16.5 percent to $8.7 billion in the U.S. in 2017, and the majority of the growth is due to music streaming services. According to an annual report from the Recording Industry Association of America (RIAA), it is the second consecutive year of significant growth since 1999.
The growth was almost entirely because of the public’s grip of streaming, with subscriptions to paid platforms such as Spotify, Apple Music, Tidal and the new service of retail giant Amazon growing 56 per cent to 35.3 million users.
The number of paying streaming subscribers to full premium on demand services hit 35.3m in the year on average, up by 12.6m, which was monitored 22.7m in 2016.
Ad-supported interactive streaming services like YouTube and Spotify’s free tier saw revenues grow 34.6% to $658.6m, while digital radio services whose royalties are collected by SoundExchange generated $652m, down 26% year-on-year. Recorded music sync royalties had a banner year, rising by 13.5% to $232.1m.
In 2016, the market increased by close to half that amount – $787m.
And on a wholesale basis i.e. the money flowing through to labels and artists – revenues increased 12.6% (or $700m) to $5.9bn.
In an accompanying blog post, RIAA Chairman and CEO Cary Sherman noted that while recorded music revenues have increased, “there’s still much work to be done in order to make this growth sustainable for long term.”
The biggest loser in the rise of on-demand streaming has been digital downloads on iTunes and elsewhere, which tumbled 25 per cent. Physical sales also fell but were propped up the continued resurgence among audiophiles of vinyl, for which revenue jumped 10 per cent.