Growth in the American record industry certainly isn’t slowing down just yet, with the Recording Industry Association Of America reporting that US recorded music revenues were up 27% year-on-year in the first half of 2021. Which means the retail value of recorded music in the US in the first half of the year was $7.1 billion, up from $5.6 billion in the same period last year.
Needless to say, that growth is still being fuelled by premium streaming, with a little bit of vinyl revival on top. Subscription revenues from streaming services were up 26% year-on-year. All streaming services combined now account for 84% of US record industry revenues, 78% of which comes from subscriptions. Which, maths fans will be pleased to know, means premium subscriptions account for nearly two thirds of total US recorded music revenues.
On the physical side, year-on-year growth rates are somewhat skewed because the first half of 2020 included the initial COVID lockdowns which impacted on high street sales and meant that – unusually – there was no Record Store Day activity in the first half of that year.
Compared to that, both vinyl and CD sales are up year-on-year in the first half of 2021, together accounting for 10% of revenues overall. Though it’s vinyl that is scoring the impressive growth, with vinyl formats now accounting for over two thirds of physical revenues.
The top line 27% growth and $7.1 billion revenue stats are retail value, ie the money through the till including the cut taken by retailers and streaming services. If you prefer your stats to be of the wholesale value variety – ie what the record industry itself receives – there the growth rate was 25%, with half year revenues rising from $3.7 billion to $4.6 billion.
Of course, all this growth on the recorded side of music contrasts with the live sector – and those artists whose businesses rely heavily on live activity – whose hopes of things returning to normal in early 2021 as the COVID vaccine roll out got properly underway were well and truly dashed as the lockdowns extended and the the delta variant of the coronavirus started to spread.
And even as the live sector slowly starts to get back to business, the record industry knows to keep its bragging about the ongoing streaming boom and the COVID-proof revenue growth it has generated to the minimum. Not least because the big debate about whether artists should be getting a bigger cut of those digital dollars continues to rage.
With that in mind the blog post from RIAA boss Mitch Glazier that accompanies his organisation’s new stats pack begins with plenty of musings about the impact of COVID on the wider music business; the music community’s role in tackling the pandemic; and the value the music industry delivers to the US economy. Only then does the stats bragging begin.
“New data released today shows just how deeply Americans continue to value and engage with recorded music”, he writes, “listening to more than 840 billion on-demand streams in the first half of the year. [This is] a record for any six month period in history and one with substantial room for continued [growth] both on audio streaming and on audiovisual platforms like TikTok and Twitch”
“Streaming continues to grow in countless ways”, he adds, “expanding its reach as the dominant form of listening today with nearly $6 billion in recorded music revenues so far this year, 84% of the total. Paid subscriptions continued a multi-year trend of strong growth, increasing 13% over the first half of 2021 to a record 82 million”.
Social media and other digital platforms that use music are also a big opportunity in the years ahead, he then says, although some might need to be kicked a bit to get all their licences sorted.
“Emerging platforms like short form video, fitness apps, and a host of chat and social apps are also getting licensed and starting to deliver meaningful revenues”, he goes on. “Record labels are moving urgently to make sure these growing services pay for the music they depend on – future proofing artist incomes as technologies shift”.
And then, of course, there’s the vinyl revival. “The data also shows continued surging interest in vinyl”, he writes, “rebounding from the challenges and disruptions of 2020 to a new post-Napster half-year high of $467 million. Clearly, even in a time of playlists and recommendation engines, fans still uniquely value the experience of vinyl. And labels have worked to meet that demand with a steady stream of show-stopping releases, special editions, and audiophile-ready options”.
“These powerful results reflect a core truth about the ways we connect with music today”, he concludes, “as a sustained and ongoing relationship where a steady stream of listening and discovery on different devices and services is with us all day long, powering a creative and commercial renaissance”.
“One with continued new opportunities and headroom for growth and success for artists and their label partners. 2020 was no ordinary year. And 2021 hasn’t been simple either. But music’s power, lessons and spirit have been here to carry us through. And they always will be”. Lovely stuff.
We think you'll like these related articles.