At What Point Do We Say The Music Industry Is Doing Ok Again?
Vinyl isn’t cheap. I remember complaining about paying $18 for a CD in the 1990s, but now I’m happily forking over $25 for some tasty new vinyl. Add to that the Spotify family plan I’m paying $15 a month, as well as the (admittedly somewhat superfluous) $8 subscription to watch old concerts and documentaries on Qello. Then there’s concerts IRL, which run from $15 to $90 per ticket. It feels like I can safely say I’m paying more for music than ever in my life.
And it appears I’m probably not alone. The International Federation of Phonographic Industries recently released a new report showing overall growth in 2016, the second-straight year where things were looking up.
In North America, things are very much heading skyward, which saw a 7.9% boost in revenue in 2016 compared to 1.5% the year before. "Digital revenue was the driving force, growing by 16.5% and more than offsetting declining physical sales of -17.1%," says the report. "Streaming revenue showed growth of 84.1%. The US – the world’s largest recorded music market – continued its evolution, seeing an 80.5% rise in streaming income and growing by 7.6% overall, a significant increase on last year’s 1.0% growth."
After the music industry’s absolute doldrums earlier this decade— when streaming was just catching on and physical was cratering— it appears like things are slowly correcting themselves. Or, at the very least, making progress. We may never again see a wild pay frenzy like the 1980 and 1990s, but we’re certainly heading in the right direction.
One of the biggest factors for the turnaround worldwide has been streaming, which saw a 60% increase in revenue overall. Compare that with album sales, which dropped significantly: -7.6% for physical, -20.5% for downloads.
Streaming isn’t able to completely make up for those declines globally, not yet anyways, despite the fact that vinyl continues to see big gains. And record labels continue to push for better deals with streaming services.
Warner Bros. is already seeing explosive growth from streaming, with revenues rising 45% in its latest quarter. To keep that money rolling in, Warner Bros. just re-upped a licensing contract with YouTube, which is still the planet’s top music streaming service, despite its basically awful listening experience.
It’s worth noting, too, that indie labels are also cutting more favorable deals with streaming services, like the one Spotify recently agreed to with Merlin— which represents a ton of indie imprints and acts.
All this should be good news for both music artists and fans, who want the industry— at least the basic economics of it— to succeed. And while we’re nowhere near where we should be, and it's too early to declare victory, that things are at least heading in the right direction again after such a bleak period should be welcome news to everyone.