New figures released by the BPI have revealed that the trade income of UK record labels is at a five-year high, with over 5% growth in 2016.
The BPI reports that combined revenues generated through streaming, physical, downloads performance rights, and sync rose by 5.1% to an annual income of £926m. As the record industry has been in seemingly terminal decline for a number of years, this is kind of a big deal.
The story behind the stats is, in a word, streaming- there was an increase of £44.6m from 2015, with streaming revenues jumping up by 61% and accounting for 30% of overall revenue. Paid subscriptions to the likes of Spotify and Apple Music are critical here, accounting for just over 87% of the annual market total of £274m. Ad supported tiers on the other hand? 3.6%. No wonder Spotify just agreed to window certain Universal releases to the paid for tier.
Physical formats still account for 32% overall but despite all of the noise around the resilience of the CD and the (relative) resurgence of vinyl, it feels like streaming could soon overtake all to become the dominant format. Vinyl did rise by 66.5% year on year, now accounting for 15% of physical album turnover, while income from CDs dropped by 9.1%
If there is one thing that the BPI rolls out even better than an industry report, it’s a juicy quote and Chief Executive Geoff Taylor did not disappoint, saying: “It’s encouraging to see revenues rise significantly, as more and more consumers enjoy the benefits of subscribing to a premium streaming service or rediscover the joys of vinyl”.
Taylor also had the potential effects of Brexit in sight, saying: “Britain’s world-leading music sector has the potential for sustained growth in the years ahead, but this exciting future can only be realised if Government makes creative businesses a priority post-Brexit”.
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