Vinyl Sales Generated More Revenue Than Free Streams In 2015
The resurgence of vinyl continued in 2015 — just don’t call it a comeback. As revealed in the RIAA’s newly published Shipment and Revenue Statistics for 2015, vinyl sales rose 32% to $416 million last year, their highest level since 1988.
However, the recent popularity of vinyl also highlights a growing problem in the increasingly streaming-dominated music industry. 17 million albums and half a million singles accounted for that $416 million in vinyl revenue, while hundreds of billions of free, ad-supported streams on services like Spotify and YouTube only managed to generate $385 million.
Perhaps even more worrying, Billboard estimates that per-stream rates dropped 24% from $0.00666 in 2014 to $0.00506 in 2015 (although Billboard points out that “the retail rate doesn’t reflect what is paid to labels, and thus artists”).
Cary Sherman, Chairman & CEO of the RIAA, also chimed in on the issue. “This is why we, and so many of our music community brethren, feel that some technology giants have been enriching themselves at the expense of the people who actually create the music,” he wrote. “We call this the ‘value grab’ — because some companies take advantage of outdated, market-distorting government rules and regulations to either pay below fair-market rates, or avoid paying for that music altogether.”
The RIAA’s report suggests that streaming is only going to bet bigger. For the first time ever, total streaming revenues (including paid subscriptions) surpassed $2 billion last year, making it the highest grossing market (34.3%) ahead of digital downloads (34%). Although physical CD sales and digital downloads continued to fall, overall music revenue actually rose 0.9% to $7 billion.
“Overall, the data for 2015 shows a music industry that continues to adopt digital distribution platforms for the majority of its revenues,” concluded Joshua P. Friedlander, Senior Vice President of Strategic Data Analysis at the RIAA. “While overall revenue levels were only up slightly, large shifts continued to occur under the surface as streaming continued to increase its market share.”