Streaming services have become firmly cemented as the main source of revenue for the US music industry. The RIAA reports that 2018 saw a record 75% of the US music industry’s revenue come from streaming services like Spotify, Apple Music, etc. Total revenue last year was $9.8 billion.
The infographic below outlines 2018 US music industry revenue by category.
Digital and streaming formats
As noted above, industry revenue from streaming is at an all-time high; at 75% of total revenue, it’s up from two-thirds of total revenue last year.
Meanwhile, digital download revenue (from music stories like iTunes) has dropped to 11% of total earnings. It’s clear that digital’s the norm these days; people would rather subscribe to music (at $10 a month) than buy a permanent copy (at $10 an album).
The infographic below shows how streaming music revenue has grown year-by-year since 2005.
Physical formats make up 12% of revenue. Similar to previous years, vinyl sales continue to rise, now making up $419 million in revenue. That’s up 8% from 2017, and the highest they’ve been since 1988.
Meanwhile, sales of CDs have dropped to $698 million, down 34% from 2017. It’s the first time since 1986 that CD revenue has dropped below $1 billion.
I haven’t seen vinyl records this prominent since childhood. Still, I still don’t see why people want vinyl records back so badly. Debates about analog music “warmth” aside, I’ve long since considered records as nostalgia items, not as a primary source of music.
Total revenue last year came to $9.8 billion. That’s up from a low of $7 billion in 2014, when streaming revenue only made up a little more than a fourth of total earnings.
However, total revenue is still down significantly from the all-time high of $21.5 billion in 1999, when CD sales were at their peak. Of course, it helped that CDs were overpriced at the time—one reason MP3s, piracy (via Napster, etc.), and the iPod/iTunes vastly changed things in the early-to-mid 2000s.
The chart below shows the changes in music industry revenue by format.