In September we told you that the United States was about to become a $10 billion recorded music market again – for the first time since 2007.
Today (February 25) new figures published by US recorded music trade body the RIAA, show that on a retail basis – i.e. the money spent on streaming subscriptions, as well as physical and digital music – recorded music revenues in the US grew 13% in 2019 to hit $11.1bn.
This marks the fourth year in a row of double digit growth for the market.
According to the RIAA’s 2019 Year-End US Music Industry Revenue Report, music streaming accounted for 79.5% of all recorded music revenues, with total revenues from streaming growing 19.9% to $8.8bn last year (see below).
The streaming category includes premium subscription services, ad-supported on-demand services (such as YouTube, Vevo, and ad-supported Spotify), and streaming radio services (like Pandora, SiriusXM, and other Internet radio services).
The streaming market alone in 2019 was larger than the entire US recorded music market just two years ago in 2017.
Total 2019 subscription revenues of $6.8bn were up 25% compared to 2018, and accounted for 61% of total recorded music revenues in the US.
That total includes $829m in revenues from what the RIAA describes as “Limited Tier” paid subscriptions, limited by factors such as mobile access, catalog availability, on-demand limitations, or device restrictions. The likes of Amazon Prime and Pandora Plus are included in this category.
Across the year, the number of paid subscriptions (excluding limited-tier services) grew 29% to an average of 60.4 million, compared with 46.91m (see below).
Meanwhile, revenues from ad-supported tiers of services such as YouTube, Vevo, and the free version of Spotify grew 20% annually to $908m.
These types of services streamed more than 500 billion songs to more than 100 million listeners in the US, yet contributed only 8% to total music revenues for the year.
Elsewhere, revenues from physical products in 2019 declined 0.6% year-over-year to $1.15bn.
Revenues from vinyl records saw a 19% increase last year to $504 million, representing the largest revenues from vinyl since 1988, and 14 straight years of growth for the format.
Digital download revenues fell 18% to $856m in 2019, marking the first time since 2006 that revenues from downloaded tracks and albums fell below $1bn.
“Today’s report reflects the prospect of a future in which creators have a path forward. But it also reveals how much farther we must go to assure a healthy music community in which all music is valued and creators are fairly compensated.”
Mitch Glazier, RIAA
Writing in a blog post following the publication of the figures, Mitch Glazier, Chairman and CEO, RIAA, said: “Today’s report reflects the prospect of a future in which creators have a path forward. But it also reveals how much farther we must go to assure a healthy music community in which all music is valued and creators are fairly compensated. We still have not realized the full value of music on all digital services.
“Music is by far the biggest draw to tech platforms, gaining views and listens that generate enormous revenues for distributors, but in many cases this happens without an appropriate share for creators.
Added Glazier: “Our technology partners also need to commit themselves to protecting and promoting artists’ work by doing more to stop stream-ripping and other forms of piracy. That requires the platforms to work more productively with the music community as partners to stop theft and respect the true value of music.
“As we continue to work to meet these challenges, it is worth taking this moment to reflect on what we have accomplished: by investing in a vibrant music culture of diverse voices, music companies have driven a fourth consecutive year of double digit growth and continued to build a digital-driven industry with a focus on the future.
“We are working in partnership with the entire music community to provide expanded opportunities for both artists and fans and keep the heart of American culture beating for another generation.”
Music Business Worldwide