I am a pretty big consumer of music. Over the past four decades I’ve moved from vinyl albums and cassettes, to CDs, to digital downloads and finally to streaming (Spotify) as my main source of music. Turns out that my experience is pretty typical. Here are facts about where we get our music these days:
- CD sales and digital downloads (like iTunes) are large but declining sources of music. CD sales declined 16% and digital downloads declined 20% in 2016.
- Streaming services such as Spotify, Apple Music, YouTube, Google Play, Amazon, Pandora, Rhapsody, Tidal, Soundcloud (RIP), XBox Music and Slacker provide streaming music either with a paid subscription or via advertisement supported streams.
- Streaming services, at 38% of total audio consumption, are now the largest manner in which we access music.
- Here’s a chart showing the incredible growth of streaming:
- Streaming appears to be saving the music industry. In 2016 the industry recorded revenues of $15.7 billion, a 5.9% increase over 2015 and a second consecutive year of growth. These two years of growth are on the tale of 15 straight years of revenue decline totaling around -40%. However, recorded music only generates about 50% as much revenue as it did in it’s peak year of 1999.
- There were more streams played on any given day of 2016 than there were digital song downloads for the entire year. The average number of daily streams was 1.2 billion compared with 734 million song downloads during all of 2016. More than 28 million unique songs were streamed over the course of the year.
- What do Spotify and the other services pay for each song that is streamed? On average in 2016 the average per-stream rate was $0.0072. It takes about 1,500 streams to be considered the equivalent of an “album.”
- Vinyl record sales have increased 38% a year on average since 2012 (showing a high correlation with avocado sales, tattoos and sales of beard grooming equipment). 13 million vinyl albums were sold in 2016.
- Cassette sales increased a whopping 74% in 2016 (to a total 129,000 as compared to 200 million physical and digital album sales). The top selling cassette of 2016 was Guardians of the Galaxy soundtrack with about 4,00 units sold.
- The above stats have focused on amount of music consumed, not revenues. When it comes to dollars – here’s how we collectively spend our money:
Sometimes the best parts of the IFODs are the even more interesting, and wonderfully irreverent, nuggets that appear in the IFOD. Case in point:
(showing a high correlation with avocado sales, tattoos and sales of beard grooming equipment)