Tag Archives for " downloads "

Happy Days – US Music Growth The Most In 20 Years

Music sales growthIn record label executive offices across the U.S. there’s rejoicing as the latest RIAA numbers show a double digit increase in revenue for the first time in almost 20 years. The latest figures show that the recorded music market in 2016 brought in $7.7 billion, up a bit more 11% over the previous year. And guess what? Despite what the many naysayers had predicted, the growth is all because of streaming.

Streaming contributed $3.9 billion to the total revenue in 2016, which was up 69% from the year before. And get this – it now makes up 51% of the recorded music business, which is the first time it’s crossed that mark in the U.S. There’s even more good news though. There were 431.74 billion (with a B) streams counted by Nielsen Music (which includes video and audio on-demand streams), and the average per-stream rate went up to $0.0072. To put that number in perspective, that number last year was $0.00517, and in 2014 it was $0.00666.

One of the downsides of the streaming numbers is that fact that YouTube no longer reports all of its streams to Nielsen Music. Last year it began to report streaming data on artists whose music has over 1,000 views a day. That means that a lot of the streaming data is going unreported, something that’s bound to bring about some gnashing of teeth in label board rooms.

As you would expect, CD sales are now rapidly declining to the point where just 99.4 million full-length CDs were sold in the United States. Although that was worth $1.2 billion, which is nothing to sneeze at, it still marked the first time since 1986 that fewer than 100 million were sold. Top that off with the fact that downloads were down 22% last year to $1.8 billion, and you can see that it’s a good thing that streaming has picked up the slack.

The numbers show that the vinyl fad looks like it has peaked though, as sales revenue grew just 3.5% to around $430 million, based on a 1.8% growth of unit sales to 17.2 million. To put that into perspective, vinyl growth averaged 38 percent a year from 2012 through 2015, according to Nielsen Music numbers.

So overall, the music business is now picking up steam in the right direction. Hopefully the growth trend will continue.

Goodbye MP3, We Hardly Knew Ya

Goodbye MP3When it comes to technology, the music business has always been about convenience. It’s ultimately never about the sound or even a lower cost, it’s always comes down to what’s easiest to use. Still, it’s surprising to see the MP3 file format (or the “download” as many know it) accelerating so quickly towards the end of its useful service life.

From the beginning of the modern music business, consumers have quickly gravitated to the latest technology that made it easier for them get their music fix. Going way back to the 1880s, the business consisted of distributing sheet music that the family musician would use to play the latest songs in the living room. When the player piano was introduced, piano rolls became the must-have product.

The Victrola brought the 78 RPM shellac record in the early 1900s, which was soon replaced by the much more durable 33 1/3rd RPM vinyl record that could hold more than twice as much music. But vinyl records weren’t portable, so in the 1960s 8 track tapes became a big hit for taking your music with you in your car. Cassettes were more convenient however, since they were smaller and operated more like a record album, having two sides. They also provided the ability to fast forward and reverse to quickly find the song you wanted, features not available on the 8 track.

The CD was a revelation, not so much for the digital audio it provided, but for its random access ability that let the user easily select a track with no rewinding or forwarding. This is where the music industry got greedy and included a “technology charge” on every CD, jacking the price up far higher than need be, which eventually caused a consumer backlash after the newness of the format wore off.

That dovetailed into the rise of personal computers and the internet, and the ability to share music was high on the list things that the average computer user craved. In Germany, the Fraunhofer Institute developed the MP3 file format in 1993, but it wasn’t until 1997 when it finally took off thanks to the advent of the Winamp player and popularized by MP3.com website.

An MP3 file “let the air out of the tire” of a standard digital CD file, making it about 10 times smaller in size. As a result, music files could then be easily transferred over the low bandwidth online connections of the times (remember, we’re talking the old 32kbd modem days). Not only that, a user’s favorite songs could be ripped from a CD then freely shared with friends without having to pay those sky-high CD prices. Before you knew it, the revolution had arrived as piracy ran rampant, sales waned and record stores closed.

After several feeble attempts to open up an online music store by the major labels, Apple came to rescue with iTunes in 2003, the first large scale way to monetize digital music, a move that the majors rue till this day. [Read more on Forbes…]

Music Industry News Roundup #4

Music Industry News Roundup Here’s some interesting music business news from the last week. There’s a lot going on in the streaming world, but as usual, that’s not all.

Warner Music had it’s best quarter in a long time. Streaming agrees with this major label, and it’s up around 14% over the same time last year. Guest what? It’s all due to streaming.

“Happy Birthday” is copyright free, but what about “We Shall Overcome” and “This Land Is Your Land?” Both are considered national treasures and thought to be in the public domain, but are instead controlled by the daughter of Woody Guthrie. New lawsuits attempt to change that, but what does it mean for copyright law?

Many superstars are going it alone without a manager. Taylor Swift, Bruno Mars, Beyonce and Ariana Grande are using a close tight nit team to guide their careers instead of traditional management companies. Prince was notorious for doing the same thing, and Mick Jagger has essentially guided the Rolling Stones since early in their career. Works for some, not so much for others as Queen and Billy Joel had a rough time after trying the strategy.

Drake’s Views chart dominance is mainly due to streaming. It seems that sales aren’t what they used to be, but I’ve been making that point for a long time.

Spotify is trying to program ads based on your musical tastes. The company is now asking advertisers to submit ads that fit specific profiles to better target listeners on its free ad-supported tier. Creepy or smart?

Song pluggers now target playlists. Song “pluggers” or promoters used to target just radio in order to raise the profile of a song and make it a hit, now they target various playlists instead.

Apple has fixed a big problem with Apple Music. It has moved to fingerprinting technology to help better match your personal music collection to its online catalog. User have been frustrated with inaccurate matches, but this promises to kill the bug.

Downloads will be dead by 2020. That’s what this article predicts as it looks at the downward spiral down of downloadable music consumption. Not analysts believe it will happen this quickly, by the way.

Has streaming broken the UK singles charts? A better question might be, what dos the singles chart now measure, because it certainly isn’t sales.

That’s the News Roundup of what went on in the music industry last week. Let’s see what next week brings.