While not everything in the American music market is going well (we’ll miss you, digital downloads), the industry itself is on the upswing, and things are getting better all the time, at least according to some metrics.
The RIAA (the Recording Industry Association of America) released its look at how the U.S. music industry is doing at the six-month mark recently, and the major takeaway from the report is that streaming is bigger—and more valuable—than ever before. In just the first half of 2017, retail revenues grew 17% from the same time a year ago to an even $4 billion. It was only back at the midway point in 2015 that retail revenue blew past $3 billion once again, so it’s clear that the forward momentum isn't slowing down. Of the reported $4 billion sum, streaming services of all kinds were responsible for $2.5 billion. That figure itself is up an impressive 48% from the year prior.
The fact that money is once again pouring into the music industry is certainly welcome by all involved, as for a long time, the business was suffering from rampant piracy. The good news doesn’t stop at that level though, and it gets even better when the numbers are broken down even further.
The segment of streaming music that has grown the most in the U.S. so far this year is paid subscriptions, which is the focus for most streaming companies, and which is surely music to the ears of those running major labels. Revenue from fans paying to listen to whatever they like on platforms like Spotify and Apple Music increased by 61% (when compared to H1 2016) to $1.7 billion. The rest of the $2.5 billion comes from those using ad-supported on-demand options or tiers, as well as listeners who prefer to stick with radio services. Those two categories brought in $273 million and $493 million, respectively.
On average, consumers who pay a monthly subscription fee for their listening privileges are more valuable than those who don’t seem to mind ads being inserted into their playlists and album run-throughs. There is currently a big push to convert free users into paid ones, and the more subscribers there are, the more money the companies running those platforms, and the industry on the whole, will earn.
There are now 30 million people in America subscribing to a streaming music site, a new high. According to the report, that number shows that between now and when the 2016 mid-year analysis was made public, at least one million new subscribers have signed up every month.
