Streaming music usurps digital downloads for first time in 2015, RIAA says
In 2015, streaming services like Spotify and Apple Music generated $2.4 billion for the wider U.S. music industry to surpass sales from digital stores like iTunes, according to new data from the Recording Industry Association of America.
Streaming revenue's share of total industry revenue grew from 27 percent in 2014 to 34.3 percent in 2015 (PDF link), enough to slip by collective digital music sales, which accounted for 34 percent of the market over the same period. A long time coming, and riding a groundswell of momentum, streaming's overthrow of outright digital sales augurs a fundamental shift in user preference.
Breaking down the data further, the RIAA says all sectors of the streaming market grew last year, including revenue from streaming radio services distributed by SoundExchange. Revenues from paid subscriptions for services like Apple Music, Spotify and Tidal, rose 50.3 percent year-over-year, while ad-supported on-demand streaming outlets like YouTube jumped 30.6 percent. With an annual average of 10.8 million subscribers helping to drive $2.4 billion in overall revenue -- the first time streaming crossed the $2 billion threshold -- the sector was up 29 percent.
By comparison, revenue from digital downloads fell 12.8 percent for singles and 5.2 percent for full albums, ending the year at $1.25 billion and $1.1 billion, respectively. Kiosk, ringtone and music video sales brought in another $64.7 million.
On the whole, the music industry grew 0.9 percent year-over-year to generate more than $7 billion.
The smartphone revolution is thought to have catalyzed adoption of streaming music solutions. And with the rise of attractive cellular data plans, a result of mobile providers' fight for marketshare, music services offering vast content libraries and all-you-can-eat subscriptions have become viable options for a wider demographic.
Apple, whose iTunes platform popularized and currently dominates the digital downloads market, launched its own Apple Music streaming service last year. With an app built in to millions of iOS devices, Apple Music is enjoying a strong debut, reaching 11 million subscribers as of February.
Streaming revenue's share of total industry revenue grew from 27 percent in 2014 to 34.3 percent in 2015 (PDF link), enough to slip by collective digital music sales, which accounted for 34 percent of the market over the same period. A long time coming, and riding a groundswell of momentum, streaming's overthrow of outright digital sales augurs a fundamental shift in user preference.
Breaking down the data further, the RIAA says all sectors of the streaming market grew last year, including revenue from streaming radio services distributed by SoundExchange. Revenues from paid subscriptions for services like Apple Music, Spotify and Tidal, rose 50.3 percent year-over-year, while ad-supported on-demand streaming outlets like YouTube jumped 30.6 percent. With an annual average of 10.8 million subscribers helping to drive $2.4 billion in overall revenue -- the first time streaming crossed the $2 billion threshold -- the sector was up 29 percent.
By comparison, revenue from digital downloads fell 12.8 percent for singles and 5.2 percent for full albums, ending the year at $1.25 billion and $1.1 billion, respectively. Kiosk, ringtone and music video sales brought in another $64.7 million.
On the whole, the music industry grew 0.9 percent year-over-year to generate more than $7 billion.
The smartphone revolution is thought to have catalyzed adoption of streaming music solutions. And with the rise of attractive cellular data plans, a result of mobile providers' fight for marketshare, music services offering vast content libraries and all-you-can-eat subscriptions have become viable options for a wider demographic.
Apple, whose iTunes platform popularized and currently dominates the digital downloads market, launched its own Apple Music streaming service last year. With an app built in to millions of iOS devices, Apple Music is enjoying a strong debut, reaching 11 million subscribers as of February.
Comments
As for disposable elevator ditties? Huh what?
There are tens of thousands of indie songs that are not that if your so inclined, along with elevator ditties if that's your bag.
It's not like the 2000s or 1990s were the summum of music.
For me, the best music was the 1960s and 1980s, but these days are pretty good too considering how broad the musical choices are compared to even the late 1990s or early 2000s (that's when the true desert existed).
Still who's going to knock back a trip Tibet.
That's nothing now... Just like the Internet was "nothing" in 1995.
It is likely Apple will reach 25M paying subscribers by the end of the year; the family plan in particular is going to hurt Spotify bad.
I would not be surprised if Apple goes Netflix and have a video service by years end too.
There is a kind of network effect with the propagation of these kind of things.
It grows slowly but surely until a threshold is met (a lot of your friends have it) and then, bang it goes to the moon.
By the end of 2018, Apple could even sell the Apple music service as part of buying the phone (for those that finance).
So, Apple would sell experience and not just hardware; that's what Jobs wanted, that tech disapeers and becomes of tool to live fuller lives, not being slaves to it.
The constantly upgraded hardware would just be a means to deliver the best experience and would become transparent to the user, they get a phone in the mail, initiate an upgrade and both phones get synced and then you just put the old phone in the box (it's now wiped) and ship it, and you use the new phone.
You'd pay say $50 a month a you constantly have the latest greatest phone, watch and all the music and videos you want.
Myself got 30K tunes ripped from CD's and Vinyls (collected over 30+ years) but within 10 years, we'll be seen as quaint dinosaurs..
BTW, I have a huge collection of 24/96 music files in FLAC that got converted to Apple Lossless format when I converted to Mac, but I still subscribed to Apple Music for music discovery and convenience. YMMV.
It's depressing when (mostly android) kids brag about stealing music and call people "stupid" for paying for art. I think the government needs to come down hard on these thieves otherwise music will continue to be stolen. I'd start with YouTube and sue the fu** out of them for having so much unlicensed music uploaded. I'm around teens regularly and they mostly use low quality YouTube videos uploaded by other teens and never purchase a single song. Heck there's a teen sitting across the room right now doing this.
Dont kid yourselves YouTube is the new Napster except 20x worse.