According to a recent report from the Recording Industry Association of America, streaming music services saw a 29 percent increase in revenue in 2014, even though the music industry as a whole saw a 0.5 percent decline in revenue. Sales of CDs and digital downloads both declined, and this marks the first year that income from streaming services was higher than that of CD sales.
The U.S. music industry shrank 0.5 percent in 2014 as growth in streaming services like Spotify Ltd. failed to counter declining consumer spending on albums and songs.
Revenue from streaming subscriptions, Web radio and online advertising grew 29 percent to $1.88 billion last year, according to a report Wednesday from the Recording Industry Association of America.
The report demonstrates why record label executives have said streaming is the future of their business, even if overall music consumption shows few signs of growth. Sales of CDs and vinyl declined 7.1 percent to $2.27 billion. Online purchases, once a source of strong growth, fell similarly to $2.58 billion for the second straight annual drop.
User growth in the U.S. slowed during 2014 compared with the each of two previous years, when the total numbers of subscribers to streaming services almost doubled annually. Spotify is the largest subscription service. In May, Apple Inc. agreed to pay $3 billion to buy headphones and streaming-music service Beats in the company’s biggest-ever purchase.
To read the complete Bloomberg article, click here.
• Sales of Streaming Music Top CDs in Flat Year for Industry at NYTimes.com.
• Sony Questions Value of Free, Ad-Supported Music Streaming Services at HomeTheaterReview.com.