Streaming is crushing downloads at Sony Music, claiming 42% of revenues

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Streaming has now firmly established itself as Sony Music’s biggest money-making format – walking all over downloads, which are shrinking at a pace.

In fact, streaming is now generating more than double the money for Sony that the major is receiving from iTunes and others.

In the three months to end of September (Sony’s Q2), streaming made up 41.5% of Sony’s retail recorded music revenues (excluding licensing income), with download pegged back on just 18%. Physical sales stayed strong, claiming the remaining 40.5%.

Streaming generated 31.49bn Yen ($303m) in the Q2 period, up 26.6% year-on-year.

Download, on the other hand, generated just 13.69bn Yen ($132m) – falling by a painful 31.6% compared to the same quarter of 2015.

That’s a difference between the two formats of more than $150m – or $50m per month.

Streaming’s growth in Sony’s Q2 was up 6.63bn Yen ($64m) year-on-year – only just offsetting download’s decline of 6.32bn Yen ($61m).

When licensing income (sync, performance, broadcast etc.) is factored in, streaming made up over 35% of Sony’s recorded music revenues in the quarter (Sony’s Q2) with download on a measly 15%.

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Sony’s total music income – including publishing, records and ‘visual, media and platform’ – was up 8% to 150.2bn Yen ($1.49bn) in its Q2, growing 19% at constant currency.

However, these gains were largely thanks to sales of a mobile video game title called Fate/Grand Order (categorized as ‘visual media and platform’).

Sony’s recorded music revenues actually fell slightly in the period, down 1% year-on-year to 89.76bn Yen ($865m) – badly hampered by the strength of the Yen against the US dollar. (It’s expected that recorded revenues rose at constant currency.)

Elsewhere, Q2 music publishing revenues – which include Sony/ATV, plus Sony’s publishing activities in Japan – fell 11.9% to 15.59bn Yen ($150m).

Best-selling titles included Celine Dion’s Encore un soir (pictured), Nogizaka46’s Hadashi de Summer and Kana Nishino’s Just Love.

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(Remember that Sony’s Q3 is calendar Q4? That huge blue spike up there in 2015… that’s pretty much Adele. Adele and Christmas. But mainly Adele.)


In the first three quarters of calendar 2016, Sony brought in 94.18bn Yen ($908m) from streaming, and 50.89bn ($491m) from download.

Physical sales remained robust, generating 92.27bn ($889m) in the same nine month period.

That all means Sony’s income from streaming is easily set to surpass $1bn this year – but currency exchanges are clearly hurting the Japan-based business’s bottom line.

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screen-shot-2016-11-01-at-18-01-10Music Business Worldwide

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  • Yes, because illegal stream ripping is off the charts. The recorded music business is getting killed by a totally unregulated internet.

    • KneeJerk

      “Illegal stream ripping is off the charts”. I’m sorry, but could you find some of these charts? I would be interested in seeing them. In the meantime could you please quit with the hyperbole and sky is falling nonsense?

      • For some reason I am unable to post a response using a link to a previous article in this publication on the rise in stream ripping.

  • drk@dynamicrecording.com

    Open letter to the Music Industry:

    As you know, there is a lot of discussion regarding the fair payment

    of writers and performers of music

    that is being streamed – whether for a very small price per stream or for free.

    At Dynamic, where we have many, many recordings available on CD Baby,

    we feel that

    our income has been adversely affected by the policies in place right

    now. A look at our earnings (and therefore the earnings of CD Baby too!)

    demonstrates that through the first quarter of 2016, our revenues are

    only at 67% of the same quarter last year.

    2015 was down slightly from 2015, and I’m guessing that if we had not

    added additional titles during 2015, the difference

    may have been more significant. If this trend continues through

    2016, being down 33% in CD Baby income is not good.

    And we’re only one company on CD Baby – if other musicians, record

    companies, independent performers, etc. are seeing the

    same trend, it’s a serious loss in income to people who are not being

    compensated properly for streamed and free music.

    We believe CD Baby should unite with the others who have taken a

    stand to gain reasonable payment for artistic endeavors.

    Spotify payment to Dynamic Recording:

    63 streams – $.06 cents. This is a major rip off.

    Radio stations pay us 8.5 cents per play.

    cdBaby, iTunes, amazon all pay us well.

    Smart music buyers love the free music and do not purchase or download.

    Many top Artists have pulled there music from streaming, because their sales

    and downloads have dried up.

    Sincerely,

    Dave Kaspersin

    President

    Dynamic Recording Studio Independent Label

    • Divided Souls

      I’m working on a community to address this and join the fight. Good read sir!

      • drk@dynamicrecording.com

        Count me in.