Posted on 03.05.2017.
Newly released sales figures for 2016 show we’re a nation of borrowers rather than owners of music, preferring to spend our money on streaming services. Except for those round black plastic things.
As with owning your own home, the idea of owning your own music is fast becoming a dream of the past in Australia.
We are now officially a nation of borrowers, not owners, and we are living in the land of Spotify and Apple Music, Google Play and Deezer.
Sales figures for music in 2016 compiled by the Australian Record Industry Association, show that where once buying a single or album – on vinyl, CD, cassette, DVD or download – was automatic, Australians increasingly prefer to get their music via streaming services which “lend”, or allow music to be accessed.
Revenue from streaming services has for the first time outstripped both digital downloads and physical versions of music sales.
Whereas a little over $105 million was spent on legal downloading and $87 million on CD albums in 2016, more than $135.5 million was spent on streaming.
The growth in the popularity of streaming has seen revenue from that source increase fivefold in two years, from just under $32 million in 2014. That was the year when digital downloads seemed to own the present and the future with what now is clear was its highpoint of $152 million.
Streaming has been embraced by record companies, many of whom have invested in the streaming services, but less so by artists.
Songwriters and performers regularly complain about minimal returns, often of only a few cents for every play of a song on a streaming service, prompting some such as power couple Jay-Z and Beyonce to start a streaming service of their own, Tidal, and others such as Taylor Swift, to withhold their music from some services for short periods.
However, the labels, whose demise was predicted a decade ago by some more excitable critics, have partially restored their bank balances and their relative power compared with artists, by negotiating priority revenue arrangements with the streamers. As investors and clients, the labels are doing ok.
Not all the news is streaming though. Vinyl sales continue to grow exponentially, almost doubling between 2015 and 2016, to a high for this century of $15 million. This is impressive in its own way though still not much more than 10 per cent of streaming revenue.
Such growth reflects interest from both older buyers and a new generation, many of whom have developed an attachment to a physical version of their music after growing up as downloaders and streamers.
Retailers have reported in recent years that some of those buying vinyl, and the even more niche cassette tapes, may not even have a turntable or tape player, but show their support for an artist by buying something physical. It may be the equivalent of the tour t-shirt or the concert program.
Not that artists, looking to make any sort of income while labels and streaming services profit, will complain. Most of them won’t be buying a house any time soon either.