US recorded music market dips 0.5% in first half of 2015

New figures released by the RIAA show that retail revenues for the US recorded music market fell 0.5% between early January and end of June 2015, compared to the same period of 2014. Wholesale revenues were up 0.8%.

Total revenues in the six months to end of June across physical, digital and sync amounted to $3.166 billion, down from the $3.182 billion generated in 1H 2014.

The most significant aspect of the figures is that streaming services generated over $1 billon (total: $1.03 billion) in the six months for the first time in history. Revenues from this source were up 23.2%, equating to a rise of $193.7 million.

Streaming is offsetting declines in download as consumers increasingly embrace streaming. Digital music (downloads and streaming) was $2.3 million, up 6% compared to the first six months of 2014. But downloads were down 4% to $1.3 billion.

Digital now accounts for 76% of the overall industry’s revenue, compared to 71% 1H 2014. Revenue from digital albums was up 4% to $672 million with unit sales up 5% to 57.5 million. But digital tracks lost their revenue, down 9% to $688 million after unit sales dropped by 12% to 570 million.

Physical formats were down 17% to $748 million. Its slide was arrested by the growing popularity of vinyl, up 52% in value and now accounting for 30% of value. CDs make up 66% of physical value.

Synchronisation royalties stood at $94.5 million for the first half of the year, up 4% versus 1H 2014.

Streaming services are become increasingly significant players in the American market. Paid subscriptions and streaming royalties were up 23.2% to $1.03 billion. Digital subscription revenue grew 24.9% to $477.9 million, an increase of $95.2 million, when measured in retail dollars. Royalties from ad-supported streaming services grew 27.1% (or $34.7 million) to $162.7 million.

But the amount of consumers switching to paid subscriptions is disappointingly slow. In the first six months, only 200,000 joined, bringing the total of US streaming subscribers to 8.1 million. (Apple Music figures are not included as it did not start until June 30, the last day of this report).

“The data continues to reflect the story of a business undergoing an enormous transition," said RIAA Chairman and CEO Cary Sherman. "There are many positive signs: continuing the trend from 2014, wholesale revenues for the first half of 2015 increased. And revenues from streaming music services continue to grow at a healthy double digit rate.

“The product of music and the extraordinary roster of artists represented by today’s music labels remains in high demand. That is the bedrock of a successful future."

Image: Haim's debut album entered the Billboard chart at #6