Streaming Powers Music’s Rev Surge (Again)
For the third straight year the US Music Industry enjoyed double digit revenue growth in 2018, all thanks to streaming. According to the RIAA total US Music rev grew to $9.8B, which was up 12% over 2017. Streaming royalties (from both subscription and ad supported tiers) grew by 30% YoY, which more than made up for declines in physical sales and digital downloads. As you can see in the first image below, streaming rev now compromises an astounding 75% of US music sales.
It’s also notable to see how much the subscription side makes up of total streaming royalties – next image. The per song royalty payouts from subscription-based listening is typically 2.5-3x the rate paid through SoundExchange for ad supported listening, so any growth in subscription listening has a much more significant impact on Music’s bottom line.
As usual, I’d like to point out that while the artists, labels, songwriters and publishers are enjoying healthy top-line growth year after year, the streamers themselves are still struggling to turn a profit. Now that the music biz is so clearly dependent on streaming, you’d think they’d have an interest in keeping their cash cow as healthy as possible.