With $15bn in revenue, 2021 was the US record industry’s biggest EVER year (kind of…)

Credit: Warner / Hugo Comte
Dua Lipa's Levitating was the US market's biggest track on a streaming basis in 2021, according to MRC Data

Here’s the headline, folks: The US recorded music industry generated USD $14.99 billion in 2021 – its biggest annual tally in history.

That stat, revealed today by MBW, comes from RIAA annual year-end data, and was up by a whopping 23% (or by $2.85 billion) on the equivalent figure from 2020 ($12.14bn).

In fact, you’d need to go all the way back to 1999 – over two decades ago – to find the previous peak year for the US industry, when it generated $14.6 billion.

The 2021 number also represented significantly larger YoY monetary growth for the US industry (+$2.85bn) than we saw in 2020 (+$1.02bn).

There is, however, a bit of small-print to take on board.

As Mitch Glazier, Chairman and CEO of the RIAA, explains in a new MBW op/ed: “We recognize that, for many, this report’s key takeaway is the topline figure of $15 billion in total recorded music revenues.

“In nominal terms (not adjusted for inflation), that’s the highest annual revenue figure in our industry’s history, surpassing the $14.6 billion reported in 1999, just before digital piracy wiped out more than half of recorded music’s economic value.

“But in inflation-adjusted dollars, last year’s figure is 37% lower than it was in 1999. We still have plenty of room to grow – to reach and surpass historical values for music.”

(Glazier’s done his sums: According to the US Bureau of Labor Statistics, $15.0 billion in Q1 2021 was worth the equivalent of around $9.4 billion in the same period of 1999.)

On a wholesale basis – i.e. the money that makes its way back to record labels, distributors and ultimately artists – the US recorded music industry generated $9.8 billion in 2021.

According to the RIAA data, that was up by $1.8 billion (+22.5%) on the $8.0 billion equivalent figure from 2020.

There are plenty of other interesting stats to get our teeth into in the latest RIAA report, too.

First up, streaming: Total streaming revenues generated by the US record industry in 2021 amounted to $12.44 billion, up 24% (or by $2.39 billion) year-on-year.

That $12.44 billion represented 83% of the total US market’s annual revenues.

However, it also encompasses a wide menu of streaming income sources, including paid subscriptions, ad-supported music streaming services, digital and customized radio, plus licenses for music on Facebook, fitness apps, and – for the first time – TikTok.

Breaking that down further, revenues from paid subscriptions only grew 23% (or by $1.79 billion) to $9.48 billion in 2021. These paid subscription revenues accounted for nearly two-thirds of total market revenues, and 76% of streaming revenues.

(This $9.48 billion paid subscription number includes what RIAA calls ‘limited-tier subscriptions’ on services limited by factors such as mobile access, catalog availability, product features, or device restrictions. Music services covered under ‘limited tier’ include Amazon Prime, Pandora Plus, plus music licenses for digital fitness apps.)

In terms of money from premium paid-for subscription services only (Spotify Premium, Apple Music, Amazon Music Unlimited etc.), the US recorded music industry generated $8.57 billion in 2021, up 23% (or by $1.60 billion) year-on-year.

And ad-supported on-demand streaming (through services like YouTube, the ad-supported version of Spotify, Facebook, and TikTok) grew 47% in 2021 to $1.76 billion.

The number of paid subscriptions in the US to on-demand music services grew 11% in 2021 to 84.0 million.

That was up by 8.5 million on the number of paid subscriptions in 2020 (75.5 million), but represented a deceleration in growth in this metric: in 2020, subscriptions grew YoY by 15.1 million.

(These subscription number figures exclude limited-tier services, and count multi-user plans as a single subscription.)

2021 was a big year for physical formats, too: RIAA reports that, for the first time since 1996, both CDs and vinyl experienced revenue growth in the same year.

Vinyl revenues grew 61% to $1.04 billion in 2021, the format’s 15th consecutive year of growth.

Meanwhile, revenues from CDs rebounded from the Covid lockdown-hit 2020.

In 2021, revenues from CDs grew 21% to $584 million, the first year-over-year increase in CD revenues since 2004.

Summing up the year’s numbers, Mitch Glazier commented: “Turning the deep downturn into years of growth that led to today’s revenue report is a testament to the power of modern label-artist partnerships. To a forward-looking industry that takes nothing for granted, celebrates the unique power of music to connect and inspire, and refuses to stand still or accept the status quo.

“Turning the deep downturn into years of growth that led to today’s revenue report is a testament to the power of modern label-artist partnerships.”

Mitch Glazier, RIAA

“No industry in history has embraced changing technologies and innovations faster than music over the last ten years – taking streaming from novelty to ubiquitous in the blink of an eye and now working to drive a new generation of social apps, shared immersive experiences, and blockchain/NFT opportunities going forward.”

Take a look at a detailed set of RIAA industry numbers for 2021 and 2020 below, and make sure you check out the org’s in-depth annual report through here.

Music Business Worldwide