It's a new year, new day people. It's time to put those plans and goals you had into action. But, that's not what I'm here to discuss today. Last year was another eventful one for the music industry. And we all know that's no surprise.
In 2016, the music industry saw its first signs of growth since the internet started ravaging it a decade and a half ago. By mid-year, labels saw revenue grow by 8.1% over the same period in 2015, fueled mostly by the explosion in subscribers (like myself) flocking to services like Spotify and Apple Music.
In early 2016, we learned that streaming had officially become the industry’s biggest source of income in 2015. While revenue from downloads and physical album sales both continued their years-long decline, streaming revenue grew 57% during the first half of 2016, and since then, all signs have pointed to continued growth. This is good news for record execs, but what it means for artists and streaming platforms (which each have their own contractual relationships with labels) is yet to be seen. As the pie grows, expect to see battles over how it all gets divvied up.
There were also big changes with the streaming itself. Amazon and SoundCloud launched Spotify competitors. Apple polished up its service with a new interface. Pandora also revealed its premium subscription service, expected to launch in the first quarter of 2017. For those keeping count, that’s three new subscription services in one year, on top of the three that launched the year before (Tidal, Apple Music, and YouTube Red).
Despite all the new competition, Spotify (which is the best in my opinion lol) has held onto its dominant role, growing its listeners and flexing its fucking playlisting muscle with more in-house curation and data-powered personalized playlists like Discover Weekly, Release Radar, and Your Daily Mix.
Despite numbers going "all the way up" (Fat Joe reference), the music industry still found reason to complain. Its target this year was YouTube, which along with Spotify’s free tier, creates what the RIAA (Recording Industry Association of America) calls a "value gap" for the industry. Ad-supported services just don’t make as much money as music subscriptions. Vinyl sales (a real tiny sliver of the music industry’s income believe it or not) generated more money than ad-supported streaming like YouTube, SoundCloud, and Spotify’s free tier.
The music industry has continued to adapt over the years, especially to the digital world of 2016. And there's much more chaos and innovation to come in 2017 and the years ahead.