RIAA mid-year report: music sales down 5%

The mid-year report from trade body RIAA (Recording Industry Association of America) has revealed music revenues in the US have fallen 4.9%.

The drop to $3.2 billion is down from the $3.35 billion that the industry accrued in the first half of 2013.

However the industry’s gains from digital revenues are slightly offsetting the losses. Digital music revenue did drop by half a percentage to $2.2 billion, from $2.214 billion in the first half of 2013, but subscription revenue and ad-supported streaming revenue is up. The RIAA estimate paid subscription services received an increase of 2.3 million subscribers to 7.8 million subscribers in the first six months of the year; this includes services with direct licenses like the one Spotify uses and excludes subscribers to statutory license service providers like Pandora. Subscription revenue jumped to $371.4 million from $301.4 million, an increase of 23.2%, and ad-supported streaming is up 56.5% to $164.7 million from $105.2 million.

Interestingly, download sales fell 11.8% to approximately $1.3 million, down from $1.47 billion, and CD sales fell 19.1% to $715.6 million from $994.1 million, but vinyl sales are up by 41% to $6.5 million in the first half of 2014, up from $4.8 million. Last year SoundScan released 2013 sales figures showing the US saw 6.1 million vinyl LPs sold, the largest number sold since 1991.

Within the US’ digital revenue, which accounts for 68% of US revenue, synchronisation royalties fell to $88 million from $98.5 million, a decrease of 10.5%. The synch business accounts for just 3% of total revenues.

The RIAA estimates the US music marketplace to be worth $2.2 billion, down from $2.3 million at mid-year 2013.

Australian acts Iggy Azalea and 5 Seconds of Summer have had massive US success in the last 12 months. 5SOS’s EP She Looks So Perfect debuted and peaked at #2 on the Billboard 200 earlier this year (selling 143,000 in its first week), while Azalea made Billboard chart history in May when Fancy became the first track by an Australian female artist to top the US chart in 33 years (following Olivia Newton-John’s Physical in 1981). Azalea also had big showings on SoundScan’s 2014 mid-year digital chart with Fancy at #7 with over 2.53 million sales and her track with Ariana Grande, Problem at #11 with 2.16 million sales.