This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
Business News Labels & Publishers
American record industry revenues down so far this year
By Chris Cooke | Published on Friday 26 September 2014
Good news for fans of bad news. The American record industry’s half-year report shows that the revenues for the first six months of 2014 were 4.9% down on the same period in 2013. That stat comes from a Recording Industry Association Of America document summarised in Billboard.
The widely discussed peaking of the US download market is mainly to blame. Despite continued rapid growth in the streaming domain (income from directly licensed subscription services is up by nearly 25%, directly licensed ad-funded platforms by over 50%, and digital revenue via SoundExchange rose too), monies generated by download sales were down over 10%, meaning the digital side of the record industry, which now accounts for 68% of overall revenue, actually dropped by half a percent.
Coupled with a further 19.1% slide in CD sales and lower income from sync, there’s plenty of room for doom and gloom here, given the line two years ago that the recorded music sector had turned a corner after a decade of decline.
Of course, emerging markets have their role to play in global recovery, and European markets do seem to be doing a better job at staying on this side of the proverbial corner, though sizable wobbles in the two biggest recorded music sectors, USA and Japan, are certainly a cause for concern. As is the US trend that rapid growth in streaming is only just – and actually not quite – compensating for declining download income.
Top level stats suggest that the streaming future is now and everything else should just be canned, and with overall streaming income now nearly equal to physical product income in the US, the Pandoras and Spotifys and YouTubes are key to the recorded music business on a whole new level when compared to three years (or even one year) ago. Though CD and vinyl sales are still slightly ahead of streaming overall, and downloading – while having peaked stateside – is still the single biggest revenue stream for now.
And let’s not forget that recorded music is just one strand of the wider music business, and while stats like these continue to leave out the other revenue streams labels now routinely share in when signing new artists, it’s increasingly hard to ascertain just how risky the record industry’s new talent investments are.
