Global Music Subscription Revenues Surpass $1 Billion with 28 Million Paying Subscribers

By Katherine Noyes Hard on the heels of the Entertainment Retailers Association’s recent news that music streaming services’ 2013 revenues were up 34% year

By Katherine NoyesHard on the heels of the Entertainment Retailers Association’s recent news that music streaming services’ 2013 revenues were up 34% year on year in the UK, both the Recording Industry Association of America (RIAA) and the International Federation of the Phonographic Industry (IFPI) last week published reports indicating that digital subscriptions stand out as a ray of sunshine and hope for the beleaguered music industry.The IFPI recently reported that revenue from music subscription services increased a full 51% in 2013, crossing the $1 billion threshold for the first time. That, in turn, helped global digital revenues grow by 4.3% and contributed to the first expansion of Europe’s music market in more than a decade, IFPI says.The IFPI estimates that more than 28 million people worldwide now pay for a music subscription, up from 20 million in 2012 and just eight million in 2010.That good news comes even as overall global music trade revenues fell by 3.9% to $15.0 billion in 2013 — largely as a result of a 16.7% tumble in Japan, which accounts for more than a fifth of global revenues. “Japan remains a market in transition, with legacy mobile products and physical format sales only now starting to decline, while streaming and subscription services are still establishing themselves,” IFPI explains.Excluding Japan, the overall global recorded music market was essentially flat, declining in value by just 0.1%.The RIAA, meanwhile, reports that US streaming music services were up 39% over 2012, reaching $1.4 billion . Included in that figure are revenues from subscription services such as Rhapsody and paid versions of Spotify, streaming radio service revenues that are distributed by SoundExchange (like Pandora, and SiriusXM) and non-subscription on-demand streaming services such as YouTube, Vevo and ad-supported Spotify.Paid subscription services, however, “grew the fastest of the digital formats, up 57% to $628 million in 2013,” the RIAA notes. “Growth came not just in dollars, but in the number of subscribers as well, with the annual average totaling over 6 million subscriptions.”

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