U.S. Recorded Music Revenues Return to Double-Digit Growth: RIAA Mid-Year Report

U.S. Recorded Music Revenues Return to Double-Digit Growth: RIAA Mid-Year Report

Recorded music revenues in the United States in the first half of 2021 returned to double-digit growth a year after the pandemic slowed the business’ upward trajectory, according to the RIAA.

In the first half of 2021, revenue grew 27% at retail over the first half of 2020 to $7.1 billion, up from $5.6 billion, resuming the trend of large year-over-year jumps that has been the norm in the industry since 2015.

That growth is once again fueled largely through streaming, which accounted for 84% of all revenues, up 26% year over year to $5.9 billion — itself more than the entire first-half revenue mark for 2020. That growth, the RIAA says, has much to do with new licensing deals with companies like Facebook and digital fitness apps like Peloton.

Within the overall streaming landscape, paid streaming subscription revenue totaled $4.6 billion — growing at the same 26% clip — and accounted for 78% of overall revenues in the first half of the year. Limited tier subscription revenue jumped to $452 million, accounting for 10% of streaming dollars, while ad-supported revenues — which took a large pandemic-related hit last year — grew 54% to $741 million. Digital and customized radio, including SoundExchange distributions, increased 3% to $585 million.

Overall, the average number of paid subscriptions for on-demand music services grew 13% to 82.1 million in the U.S., a new record, and up from 72.6 million over the same period in 2020 and 58.2 million in 2019.

Elsewhere, the vinyl explosion continued with eye-popping numbers — up 94% year over year to $467 million — albeit with significant caveats; the pandemic forced retail closures in the first half of 2020, the report notes, while Record Store Day was forced to shift from its usual April time period to later in the year. But it still accounted for two-thirds of all physical sales for the first half of the year, even as CD sales revenue also grew, up 44% to $205 million (accounting for 30% of all physical revenues). Digital download sales revenue continued to decline, down 6% to $319 million, with digital track sales revenue (down 12%) and digital album sales revenue (down 4%) both falling.

For the second straight year, vinyl sales (17 million units) outpaced CD sales (16.1 million units), turning a 30-year-long trend on its head.

Overall, streaming made up 84% of revenues; physical sales 10% of revenues; digital download sales 5% of revenues; and synch 2%.

“Emerging platforms like short form video, fitness apps, and a host of chat and social apps are also getting licensed and starting to deliver meaningful revenues,” RIAA chairman/CEO Mitch Glazier said in comments released alongside the report. “Record labels are moving urgently to make sure these growing services pay for the music they depend on — future proofing artist incomes as technologies shift.”

This is a developing story — check back for updates.

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