[Update] Is music streaming the saviour of CD and vinyl sales?

3 Jul 2015

The ever-growing exposure to music at our fingertips was supposed to herald the end of tangible music sales. To be fair, downloading ate into CD sales like nobody’s business, but can streaming be considered music’s saviour?

Figures released by the British Phonographic Industry (BPI) show that, for the first time in years, album sales across tangible, download and streaming are creeping back up.

Music streaming services, in general, are up a massive 80pc for the first six months of 2015 – they were up 100pc last year – and currently stand at 11.5bn, 3.3bn short of the whole of last year.

Vinyl is actually at a 20-year high, the CD sales slump (which has been at about 10pc a year) has reduced to just 4pc, with overall consumption of recorded music up by 4pc.

More than 22m physical album sales have been accounted for so far this year in the UK, representing a bit below half of all sales.

CD sales decline at an end?

Given the changes in how we measure record sales (digital and, more pressingly, streaming have complicated things somewhat, with a clarification at the end of this article) it’s hard to establish the true zenith in music consumption.

However the BPI – which only started measuring back in 1994 – has provided us with a snippet of info on that.

“The peak year for music consumption in the UK was 2004, when it stood at 166.6 million AES units in total,” explained BPI’s Gennaro Castaldo.

“Last year in 2014 it stood at 117m AES units*. So you can see there has been a drop using this measure, although we are hopeful this trend is now being reversed and we will see an increase this year and growth once again going forward.”

‘There’s a new narrative, with consumers streaming music before physically purchasing the music that they like’

It seems to point towards a levelling off of the music industry following a decade and a half of decline.

The latter end of that saw digital downloads, fuelled by iTunes, gutting physical sales amid a general downturn in people actually paying for music.

“The whole streaming thing, I think, has been a bonus that hasn’t been anticipated,” Castaldo said, suggesting that these UK results may well equate to similar findings in Ireland.

“It was thought it would carry on the digital trend. It has in one way, as more and more of us are doing it, but it has also permitted the idea that some people can buy music, too.”

How much is that Snoop Doggy in the window?

Castaldo suggested streaming can actually be looked at as a shop window of sorts, pushing people towards actual purchases, although not to the level of before.

“No, it won’t be the mainstream activity, all of the time,” he said, “but there is potentially a new narrative where you can stream and buy physical. It’s allowing us to think of a new form of music consumption that might not have seemed possible when digital downloads had a decade of growth, fuelled by iTunes.”

If what Castaldo suggests actually comes to fruition, then tangible sales are due a big boost. Streaming is skyrocketing, even before the likes of Tidal and – far more importantly – Apple Music get accounted for.

The most-streamed track of the year to date, Mark Ronson’s Uptown Funk, has been streamed 45 million times, with 59 songs in total getting more than 10 million streams.

Now That’s What I Call Music!

By the way, video streaming and downloads aren’t measured in all this, so all those YouTube views aren’t even taken into consideration.

What’s pretty cool is what’s helping to arrest the decline of CDs: compilations. What’s even cooler is what’s helping drive those compilations: Now That’s What I Call Music!.

Since January, sales of compilation albums have risen 5pc. Now 90 (!), released at the end of March, has already outsold the entire annual total achieved by its 2014 equivalent, Now 87.

*For AES units, single streams are taken into account for overall album downloads by a ratio of 1,000:1, which is an industry-accepted measure. Digital downloaded singles are rated at 10:1.

*Update* This article was updated at 14.30 on Friday 3 July to include information on the record number of… records sold in a given year.

Main image, via Shutterstock

Gordon Hunt was a journalist with Silicon Republic