Overall revenue in the music industry rose noticeably in the first half of this year, led by increasing numbers of people using music streaming services, according to figures released Wednesday by the industry's lobbying arm, the Recording Industry Assn. of America.
The RIAA estimated retail revenue in the first six months of 2017 at $4 billion, up more than 17% over the same period last year, with money generated by streaming services accounting for 62% of that total.
Revenue from all forms of streaming – including paid subscriptions, ad-supported on-demand services and digital and customized radio streaming platforms — has steadily increased over the last three years, the RIAA reported, with paid subscriptions showing the most dramatic growth, from $474,000 in the first half of 2015 to $1.7 million so far this year, an increase of 258% in just two years.
Looking at the big picture, however, the RIAA noted in a statement, "This growth reflects a continuation of the trends from 2016, but overall market revenues are still significantly below the levels they were in 1999."
Another potentially troubling figure to performers, publishers and other copyright holders was a sharp decrease in payments to music creators through the SoundExchange distribution service. In the first six months of 2016 those payments totaled more than $403 million, but fell almost 16% to $340 million so far this year.
RIAA officials, however, noted that Pandora radio and a few other streaming services have negotiated direct payments to record labels, and that adding in those direct payments, the overall figure for revenue from digital radio services increased 21% to $493 million.
The demise of permanent downloads of music has continued apace in the first half of 2017, generating $757 million — less than half of the business such downloads did in the first half of 2013, when they tallied $1.54 billion.
Meanwhile, sales of physical products — from vinyl LPs, EPs and singles to cassettes, music videos, DVD Audio and SACD discs — virtually held steady, with just a 1% drop from the first half of 2016, down from $641 million to $632 million.
Within that segment of the business, sales of vinyl LPs continued to grow, although more slowly than in recent years, posting a 3.2% increase from $176.1 million to $181.7 million. That resulted from higher average prices rather than increased unit sales, which remained the same from the first half of 2016 to the first half of 2017 at 7.2 million units.
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