Streaming Revenue Is Slowing, CDs Are Slipping, Synchs Are Up: RIAA – Billboard

Streaming Revenue Is Slowing, CDs Are Slipping, Synchs Are Up: RIAA – Billboard


The music subscription market, the driving force behind the U.S. recorded music industry’s six-year growth streak, posted another gain in the first half of 2022, according to RIAA midyear figures released Wednesday (Sept. 21). But revenue from paid services such as Spotify, Apple Music and YouTube Music have slowed from earlier break-neck paces.

After rising at double-digit growth rates in recent years, subscription revenue grew by only 9.4% in the first half of 2022, down from 11.3% at the mid-point of 2021 and 13.7% at the mid-point of 2020. The $387.6 million increase, to $4.5 billion, was less than half of the $823.5 million reported a year earlier, a period in which streaming services surged during the early pandemic’s lock-down periods and strict restrictions. Still, subscription revenue growth in the first half of 2022 was also smaller than the $403.2 million gain in the 2020 midyear report and the $653.6 million gain in the 2019 midyear report.

Here are four more takeaways:

Subscriber growth rate also fell to single digits. At 90 million subscribers, the U.S. market added 8 million subscribers – a 9.8% gain – from mid-2021. (The RIAA reports an average number of subscribers for the time period. By that measure, the U.S. had an average of 90 million subscribers in the first six months of the year, not 90 million on June 30.) That was considerably smaller than the 9.4-million gain – equal to 13.0% — in the first half of 2021. At the midpoint of 2020, subscriptions were up 13.9 million – or 24.0%.

The average revenue per user fell to $50.09 from $50.31 a year earlier. (The RIAA does not report this metric. Billboard calculated ARPU using the two metrics in the report: paid subscription revenue and the average number of subscribers.) ARPU had risen from $46.47 in the first half of 2020 and $49.95 in the first half of 2019. Some annual prices have, however, risen in the last year: Spotify raised its family plan from $14.99 to $15.99 in April 2021. In May, Amazon raised the price of its Amazon Music single-device plan from $3.99 to $4.99 and Music Unlimited from $7.99 to $8.99, or from $79 to $89 annually.

CD sales fell 2.2% after bouncing back. The format rose 20.9% in calendar 2021 and 43.9% at midyear 2021, but now sales are reverting to the mean after artists returned to touring and brick-and-mortar retail sales rebounded following a pandemic slowdown in 2020. CD sales are still down from pre-pandemic levels in terms of dollar amount, however: The $199.7 million of CD sales in the first half of 2022 were about 19% lower than the $247.9 million in the first half of 2019.

Synchronization revenues jumped 29.9% to $178 million. Synchronization royalties come from instances where music is synchronized with audio/visual works – advertisements, television shows, movies and movie trailers, for example. That was a remarkable jump for a category that remained steady in the previous four midyear periods: $137 million (H1 2021), $128.7 million (H1 2020), $129.1 million (H1 2019) and $131 million (H1 2018).




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