Streaming is saving the music industry
According to the RIAA, In 2017 revenues from recorded music in the United States increased 16.5% at estimated retail value to $8.7 billion, continuing the growth from the previous year. Similar to 2016, these increases came primarily from growth in paid music subscriptions to services like Spotify, Amazon, Tidal, AppleMusic, Pandora and others, which grew by more than 50%.
This is the first time since 1999 that U.S. music revenues grew materially for two years in a row. At $8.7 billion, the industry has taken a decade to return to the same overall revenue level as 2008, and is still 40% below peak levels as the growth from streaming has been offset by continued declines in revenues from both physical and digital unit based sales.
Streaming music platforms accounted for almost 2/3rd of total U.S. music industry revenues in 2017, and contributed nearly all of the growth. The streaming category includes revenues from premium subscription services, streaming radio services including those revenues distributed by SoundExchange (like Pandora, SiriusXM, and other Internet radio), and ad-supported on-demand streaming services (such as YouTube, Vevo, and ad-supported Spotify).
Total revenues from streaming platforms were up 43% to $5.7 billion, and in 2017 made up 65% of total industry revenues. Paid subscriptions were the biggest growth driver for the music industry in 2017. Year-over-year revenue growth of 63% brought total subscription revenues to more than $4 billion for the first time, making it by far the biggest format of recorded music in the United States, comprising 47% of the total market.