Digital Gabe
Cutting Edge Commentary On All Things Media

40 Years Of Music Industry Revenue In One Chart

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I have to admit this is one of the cooler graphics I’ve seen in a while.  Our friends at Visual Capitalist have created a graph which shows 40 years of revenue for the Music Industry by distribution platform.  From the industry’s peak in the CD era, to the crash and burn caused by digital downloads, to the recent resurgence thanks to streaming, it’s been one hell of a roller coaster ride.  Here are a few observations that come to mind about this infographic:

  • Napster’s Crater: It’s hard to overstate the impact Napster had on the music industry.  Even though the service only operated for a few years, it’s technology allowing listeners to download and save songs on an MP3 file (without buying a CD), obliterated the biz.  From Napster’s debut in 1999 through 2015 the industry’s revenue dropped from $21.5B to $6.9B annually – that’s a 68% hair cut!
  • Where’s Radio?: Did anyone besides me notice one big distribution platform that’s completely missing from this graphic?  Radio, with its legislative exemption on performance royalty payments, doesn’t pay to support the product it depends on.  Even lowly ringtones have paid more.  It’s no wonder the music industry has been so eager to embrace streaming as a way to get their music discovered and distributed.
  • Streaming’s Salvation: Speaking of streaming, you can easily see how the music industry is becoming so reliant on streaming revenue – especially the subscription side.  Keep in mind the streamers still aren’t profitable yet, so musicians and labels need to figure out the right balance for these groups to coexist or risk seeing their industry go into decline again.
  • What’s next?: As hot as streaming is now, it’s foolish to think it will be last great music distribution platform.  So what form of technology will come along to deliver music to us in the years to come?  Only the future knows for sure.

Such a cool topic to geek out on!  Any other observations that I’ve missed?

 

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