Saturday, 31 March 2018
Recording Industry Association of America Reports Revenues are Up in 2017
The Recording Industry Association of America (RIAA) reports that revenues are up for a second year in a row. The RIAA states that:
In 2017 revenues from recorded music in the United States increased 16.5% at estimated retail value to $8.7 billion, continuing the growth from the previous year. At wholesale, revenues grew 12.6% to $5.9 billion. Similar to 2016, these increases came primarily from growth in paid music subscriptions to services like Spotify, Amazon, Tidal, Apple Music, Pandora and others, which grew by more than 50%. This is the first time since 1999 that U.S. music revenues grew materially for two years in a row. At $8.7 billion, the industry has taken a decade to return to the same overall revenue level as 2008, and is still 40% below peak levels as the growth from streaming has been offset by continued declines in revenues from both physical and digital unit based sales.
Notably, “[s]treaming music platforms accounted for almost 2/3rd of total U.S. music industry revenues in 2017, and contributed nearly all of the growth.” Interestingly, digital download revenues slipped 25%. Also, “[s]hipments of physical products decreased just 4% to $1.5 billion in 2017, a lower rate of decline than in recent years.” This is good news for the industry; although we are talking about returning to 2008 revenue levels. An earlier WIPO report noted that positive revenue growth in prior years was attributable to two causes: streaming (new business models) and an expansion into new markets (mostly developing countries).