The music business grew by more than 16% last year to $8.7 billion, its highest level in a decade according to new figures released Thursday by the Recording Industry Assn. of America, the music industry trade organization.
As has been the case in the last several years, growth was led by increases in consumer spending on music streaming, which alone increased 43% over 2016 and now constitutes 65% of total music industry revenue, the RIAA said.
Revenue from streaming subscriptions topped $4 billion for the first time, “making it by far the biggest format of recorded music in the United States,” the report stated.
Also noteworthy: “This is the first time since 1999 that U.S. music revenues grew materially for two years in a row,” according to the report authored by Joshua P. Friedlander, RIAA’s senior vice president of strategic data analysis.
“At $8.7 billion,” the report continued, “the industry has taken a decade to return to the same overall revenue level as 2008 — and is still 40% below peak levels as the growth from streaming has been offset by continued declines in revenues from both physical and digital unit based sales.”
Indeed, revenue from physical formats decreased again but only slightly, down 4% compared to the previous year. Within that category, vinyl continued its recent resurgence with an increase of 10% to $395 million, still a relatively small slice of the overall pie — under 5% of overall industry revenue for the year.
Sales of CDs, meanwhile, dropped 6% to $1.1 billion, and revenue from digital downloads was off by a considerably greater percentage, dropping 25% to $1.3 billion.