Digital Music Boosts Music Industry Growth
While we often hear about the so-called “value gap”, the music industry’s own revenue figures reveal another story, they show healthy rises in revenue. CCIA’s new research paper highlights that, contrary to some popular beliefs, the Internet does not appear to have undone record labels and collecting societies. Furthermore, the Internet enables new business models for creators and the emergence of a broader range of artists and music intermediaries. Last but not least, consumers have more choice than ever before.
Have these benefits come at the expense of legacy music players, such as major labels and collecting societies?
We revisit data from major record labels and collecting societies surveyed in 2017 to study developments in the intervening two years. This shows a lasting trend of growth for legacy music industry players, is driven by digital services.
The International Federation of the Phonographic Industry (IFPI), representing the recording industry worldwide, reported in its Global Music Report 2019 that the market grew by 9.7% in 2018. Streaming revenue grew by 34% (29.2% in Europe) and accounted for 46.9% of global revenue, driven by a 32.9% increase in paid subscriptions.
Among the top ten music markets, Germany and France are the fourth and the fifth. In 2018, Austria was the market with the most impressive growth (20%), followed by Ireland (7.5%). The United Kingdom’s music industry also benefits from this trend. The UK music licensing company PRS for Music collected a record £746m on behalf of its members in 2018.
Music collecting societies’ collections increased by 1.8% globally between 2017 and 2018. This is the fifth consecutive year of growth.
Since 2014, the global collections by CISAC, a global association of collecting societies, are up by 26.8%. This trend does not only touch the music industry as worldwide royalty collections for creators of music, audiovisual, visual arts, drama and literature also grew by 0.9%, reaching a record €9.65 billion in 2018.