Roger Fingas
U.S. record industry revenues grew 12 percent to $9.8 billion during 2018, fueled primarily by paid subscription services such as Apple Music and Spotify Premium, according to the Recording Industry Association of America.
Paid subscriptions for the first time represented over half of all revenues, rising 32 percent to $5.4 billion, the RIAA said in an annual report (PDF link. That figure includes "limited tier" subscriptions with restrictions, such as Pandora Plus. Excluding limited tiers, the average number of active paid subscriptions reached 50.2 million.
All forms of streaming accounted for 75 percent of revenue, or $7.4 billion. Download services made up only 11 percent, and were in fact eclipsed by physical record sales, which hit 12 percent. While download services like iTunes and Bandcamp continue to have appeal, particularly for independent artists, a single album often costs as much as a month's worth of Apple Music.
Ad-supported services such as YouTube and the free version of Spotify advanced 15 percent to $760 million. Digital and "customized" radio services, including Pandora, saw revenues grow 32 percent to $1.2 billion.
In January, Apple revealed that Apple Music had topped 50 million subscribers worldwide. That still leaves it well behind Spotify, which reported 87 million paid customers as far back as November, and yet more people on its free tier.
Charles Martin
Malcolm Owen
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Wesley Hilliard
6 Comments
It would be interesting to see some numbers on what individual artists are actually making from these streaming revenues.
I expect to see a big jump in Apple's Music paid subscriptions due to Verizon offering "free" Apple Music to their top tier cell accounts. For myself I would not have tried the service as I wouldn't have expected to use it much. But now that I have it free on my phone (but NOT any of my other devices) I'm finding I like it and may end up getting a full subscription.
This is OT, but rumour is that Spotify will launch in India and will undercut Apple Music's pricing. I wonder how that will work out, considering that I pay the equivalent of $3 for a Family Subscription on Apple Music here.
Having said that, I wouldn't move to Spotify since I'm ok with just one music streaming service. The market here may not be that big, but Apple may probably have the same advantage Spotify had in the US, in that it was here first.
Since the launch of Apple Music, there have been lots of local and a few international music streaming services, like Amazon Prime. I really don't know how much of a dent Spotify will make here.