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Business News Labels & Publishers
Digital booms, though still not enough to combat physical decline
By CMU Editorial | Published on Friday 17 February 2012
Despite it looking like it might be peaking sooner than anyone would have liked a couple of years back, digital music continued to grow at quite a pace in 2011, with digital income across the British record industry up 24.7% to £281.6m, meaning digital growth offset two-thirds of the concurrent decline in physical product sales. That trend means that digital now accounts for over a third – 35.4% to be precise – of recorded music revenues.
While digital albums flagged far behind single track downloads for some time, the format has now properly taken off, so that revenue from digital albums is almost on par with that generated by digital singles, so £117.8 million in trade income versus £120.5m for singles.
Though, of course, in terms of column inches and chatter, 2011 was the year of the subscription-based streaming service rather than the download album – and that part of the digital music sector did experience the most growth in terms of revenue, up 47.5%. Though it’s worth noting subscription income for the labels totalled £24 million, while ad revenue from the streaming platforms slipped slightly to £10.7 million, putting all such services a long way behind more conventional download platforms in terms of overall cash generated (they together contributing about 12.5% of digital revenue).
We know all this, in case you wondered, because record label trade body the BPI told us. And look, here’s BPI boss Geoff Taylor saying things: “It is highly encouraging for the long-term prospects of the industry that the pace of digital growth continues to accelerate. British labels are supporting a wide range of innovative music services and music fans are embracing digital like never before. The record industry has continued to invest heavily in discovering and supporting outstanding British talent, which has helped sustain revenues in the face of difficult economic circumstances”.
