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Streaming to Overtake Physical Revenues for UK Labels in 2017


Streaming rules everything around us, not only musically, but digitally, in most formats. It’s the easiest and most on-demand way to access new, old, and timeless music. Not only is it popular with listeners and artists, but it’s quietly jumping ahead as a leading revenue provider within the industry.

Read on to learn about the latest trade-income figures from BPI, and the reasons why streaming is likely to jump ahead of physical revenues (in some parts of the world) for 2017.

{Editor’s Note: This is a post brought to you by MusicAlly, a premier provider of digital music journalism and consultancy.}

British music-industry body the BPI has published its latest trade-income figures this morning, and while the 5.1% growth in label revenues is the headline, it’s the prediction that streaming will overtake physical revenues for British labels this year that sticks in the mind.

Figures first, though. Trade income for UK labels rose from £881.3m in 2015 to £925.8m in 2016 – the 5.1% rise. It’s a now-familiar story of sales-down / streaming-up. Income from physical sales was down 1.9% to £298.4m; download revenues were down 27.3% to £151m; and streaming income for the British labels was up by 60.6% to £273.9m.

Subscriptions accounted for 87.1% of that latter figure, with the BPI citing research from Kantar suggesting that by the end of 2016, 11% of the UK’s adult population were using a paid streaming service, up from 9% a year before.

“Streaming accounted for 30 per cent of overall label revenues in 2016 (compared to physical at 32 per cent),” reported the BPI. “Such a rate of growth will undoubtedly see the format overtake physical to become the leading contributor to label revenues in 2017.”

Other points of interest: video streams generated £25.5m of trade income for British labels in 2016. With vinyl accounting for 15% of the £284.7m physical album-sales income (i.e. £42.7m) that suggests BPI boss Geoff Taylor’s past claim that vinyl is bigger than YouTube for its members holds true – although so will our perennial caveat about the different costs and profit margins of these two areas.

Finally, there’s the obligatory comparison of the BPI’s trade-income figures to the Entertainment Retailers Associaton’s retail (i.e. consumer spending) figures, which were released in January. £475.4m of physical retail revenues translated to £298.4m of trade income for labels (so roughly 62.8%); £214.6m of download sales translated to £151m for the labels (so 70.4%).

And streaming? ERA only tracked paid streaming subscriptions spending: £418.5m, which converted to £238.6m of trade income in the BPI’s figures – 57%.



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