We’ve talked in the past about how streaming services are on the rise in the music industry, although not everyone is profiting from it due to the drop in digital downloads. That said, it’s a trend that isn’t likely to drop off anytime soon – if at all.
Re/code recently posted an article indicating the recent findings from a report by Warner Music Group. The report states that streaming music revenue has managed to pass revenue from paid downloads, marking the first time that the medium has done so for a major music label.
Services like Spotify, Pandora and YouTube have handily grown 33 percent for the second quarter, according to Warner. CEO Stephen Cooper explained the findings during a recent earnings call by the company, also pointing out that digital revenue has grown seven perfect overall. However, it’s not good news for all, as services like Apple’s iTunes have taken a hit when it comes to download sales, although a specific download figure wasn’t given during the call.
Music labels, in an effort to find more profitability, have been pushing for music services to ease back on the free tunes in favor of paid subscriptions.
“The rate of this growth has made it abundantly clear that, in years to come, streaming will be the way that most people enjoy music,” said Cooper. “We’ll continue to collaborate with our streaming partners to expand their business, and, more importantly, to ensure that copyright owners, artists and songwriters receive appropriate value for their work.”
Warner has made big profits from licensing music to services, as it’s proven with partnerships over the last year with Snapchat, Vessel and Interlude. Still, some players are being left out in the cold, especially with the reliance of digital album sales in favor of streaming.
In the midst of all this are the musicians, many of whom (like Taylor Swift) have been vocal about the poor revenues to the artists from streaming. Worse, the transparency of the streaming music business is limited — artists get checks with no clear idea of how exactly revenues were calculated.
More opportunities are still ahead, though. Apple is still actively looking into launching some form of paid music service sometime this year, and an announcement may come as soon as next month. Other competitors, like the troubled Tidal service launched by Jay-Z, are still lurking about. Don’t be surprised if streaming becomes more of the norm in the months ahead.
