Last year, song downloads on platforms like iTunes dropped 2.3%, the first decline ever for the format. This year, paid downloads are already down 15%, according to mid-year stats just released by Nielsen Soundscan.
As of June 29th, 2014, 593.6 million digital songs have been sold in the US, down from 682.2 million at the same point in 2013.
Thank you, streaming.
I predict SHRINK down to $14billion in 2014 – sort of lucky numbers.
Thank you UMG boys for putting the music house on fire, but time to roll-up your sleeves!
YouTube, Spotify and Pandora streaming ways will not conclude your suicide – you need more dope to create another all inclusive streaming method and finish your agony!
I still think this Arena thing might be worth looking into:
“Once a listener plays any participating single song 5 times, Arena gives the listener the MP3 file to download and own while paying the artist $0.85, in addition to the $0.21 for the 5 streams, as if the listener had purchased the song to own directly.”
“By combining traditional download revenue with premium stream payouts, artists are able to earn a potential $1.90 per track per listener – roughly twice what the iTunes download store could pay for the same purchase.”
SOURCE: Hypebot (I’ll post the link below; it’ll probably appear tomorrow or later today)
One issue is that this makes less and less sense for the music fan, who oftentimes doesn’t use or care about downloads at all. I think that ship is in the process of sailing, and it’s difficult to wrap business models around falling assets.
Arena link:
http://www.hypebot.com/hypebot/2014/07/arena-can-a-free-streaming-music-service-with-a-unique-business-model-succeed.html
So, I’m the only one who’d like to know what this Arena thing is? 🙂
We need to monetize as many tunes as possible at 25 to 50 cent price (depending on the market) to have $100 billion dollar industry by 2020. Lets just convert all Radio (Pandora & XM too) and glorified streamers at least million web sites to gigantic music store. YouTube is perfect and ready to go supplier of coded tunes and payout banker to all participants.
No need for licensing negotiations by ASCAP and BMI with congress. Government imposed royalties, applied to just few participants of almost dead industry will do more harm than benefit! JUST GET NEW FAIR USE DOCTRINE AND START HARVEST MUSIC.
I emailed them over a week ago, no response.. I also mentioned they should submit a news article to Paul.. again, no response..
I don’t understand this graph. It appears that downloads have been in steady, if not erratic, decline since 2006, yet you state that las year was the first year sales were down on iTunes.
Is this attributable to a shakeout in the overall industry with business being funneled into iTunes?
They key word here is “growth rate”, that is, growth rate compared to the previous year. Downloads continued to grow but at a slower pace, until they stopped growing last year. That’s why you see 2013 below zero.
Thanks, got it.
Perhaps it is just me but I have only found 1 album released this year actually worth buying. This has been the worst year I can remember.
It’s the other way around: Nobody can afford to invest time and money in music when people don’t buy it.
Then why is there more music available than ever before in history?
In truth, Paul, there probably isn’t – unless we’re talking about the rather obvious observation that if we’ve been adding to our collective recorded music output year-on-year we’ll have more music tomorrow than we have today.
It’s way easier to release a lot of crap these days (and presumably easier to release quality material – if you know what you’re doing; most people don’t.) Back in the day you’d typically be looking for label interest, but that didn’t mean that demo tapes didn’t keep circulating. Nobody, apart from the fanzines, took any notice and the only thing that’s changed now is that these releases actually make the statistics.
I seriously don’t think that more people are making music now than there were in previous decades. It’s even likely that many are deciding not to, because they see it as an exercise in futility. It will probably take a couple of years before these declines start registering in the statistics, but given that everything thus far has gone according to the most likely scenario, my money is on this also being shown true.
I strongly disagree. I think the access to distribution, whether it’s putting it on iTunes or simply uploading to YT or Soundcloud, has taken away more hesitation to put shit out than the difficulty in “making” it has added. Not to mention the technology to record at home and/or throw some loops together and call yourself an electronic artist means the learning curve, so to speak, to be a “musician” is dramatically leveled out. Not to start this cliche argument, but you really can be a “musician” with next to no knowledge of how music works. Sure, that was possible back when every kid bought a guitar because of the Beatles, but the process of “Hey, I’m going to go record some songs, print them on vinyl and give them to people” is quite a bit of work compared “hey, I’m going to upload this thing….annndddd…..literally the entire world can now hear it.”
“Then why is there more music available than ever before in history?”
I don’t have to explain why there’s 1.000,000 times more amateur music available today, do I? 🙂 (Hint: DAWs and the so-called Internet.)
But take a look at professionally produced music — you know, the kind people actually buy — and it’s Katy Perry all over the place (and nothing wrong about her, she’s great).
It all comes down to this: Would you, Paul Resnikoff, invest your time and hard earned money in professional music production today?
There is money to be made if you actually treat your career as a job, and not like you’re some god amongst men sent down from heaven because you can write a song.
And there will always be people making music and always be people recording music. Maybe they won’t have a 1980’s sized Hit Factory studio, but maybe they’ll have a great spot outside a city. Live the simple life and help other’s make music. Not everyone is an impatient city dweller like us.
“There is money to be made if you actually treat your career as a job”
Yeah well, you’re dead if you treat songwriting as a job.
If that’s the only thing you do, then yes, it’s probably gonna be tough. Learn to produce and/or engineer, as well. Co-write during every, or almost every session, so you have songwriting credits on a ton of material.
The strange thing is, my answer would be the same now as it was in 2004, or even 1994 (though not sure I could have coherently responded at that point).
Last year was another first for iTunes and to Paul’s statement. There were fewer releases on iTunes last year for the first time.
“Perhaps it is just me but I have only found 1 album released this year actually worth buying. This has been the worst year I can remember.” Anonymous 1
Over the years there have been some great records recorded in a matter of days or weeks. But most of the great records, that endure the test of time like Revolver, Exile on Main Street, Born to Run, Joshua Tree, Hejira, Who’s Next, Dark Side of the Moon, Under the Table and Dreaming, Steely Dan, etc., etc. took thousands if not tens of thousands of hours to redord. In expensive recording studios with incredible gear, talented producers and sound engineers. Springsteen’s manager mortgaged his house to complete Born to Run.
While I’ve always believed that great music comes from great writing, often times the combination of the two seriously elevates the recording. And not just the sound quality. Working on arrangements, trying different instrumentation, having the time to get it wrong, so you can learn to make it right.
In today’s music economy, these records aren’t made very often anymore. It doesn’t pay. And like with any business, you get what you pay for.
There were fewer releases on iTunes last year for the first time.
I’d be careful about that stat. Eddie Cue (iTunes exec) claims that this proves that there’s a big problem in the music community; I’d say the music community no longer puts iTunes at the top of the list as they did just a few years back.
When Tunecore was at its peak, everyone wanted to be in iTunes. Now, I’d say platforms like Soundcloud, YouTube, and Spotify are way more important to artists. That doesn’t mean that iTunes is off the list, far from it, but artists may refrain from releasing every remix and smaller release, while some may skip it altogether.
That was unheard of back in, say 2010 or something.
Bandcamp is HUGE among DIY scenes. I know a ton of people who are part of one of those scenes where there’s like 100 people that all play with each other, in each other’s bands, etc and just make a shitton of music. Much of it is made for themselves/each other, so they don’t even bother with iTunes because they know it won’t sell. But they put it on Bandcamp because it’s free, you can stream (and get no royalties…shame), and buy if you want.
It’d be interesting to see what percentage of Bandcamp releases aren’t on iTunes.
“That doesn’t mean that iTunes is off the list”
It certainly doesn’t.
In fact, iTunes is the only way to make a living as an artist today — unless you’re touring, or teaching.
False. It’s the only way to make money if you make it the only way you make money. The band of mine that makes the most money isn’t even the one with the most fans. But they do remixes, they DJ, they compose, they sell tracks, they do production/engineer work, on top of original music syncs, iTunes sales and streaming (they’ve only toured once, and it was 6 regional dates).
And go ahead and make your argument that it’s sad they can’t sit at home spending 2 years writing 12 songs anymore, but tears don’t pay the bills.
“go ahead and make your argument that it’s sad they can’t sit at home spending 2 years writing 12 songs anymore”
Most best selling songs are made that way. They may be created by teams — but convert spent time to man-hours and you’re still looking at 12 songs per 2 years, or something very much like it. That’s just the time it takes.
A few songwriters can cut a hit in half an hour, but it took them twenty years to get there.
Sure, some track might sit around for months or years before you find a perfect melody/lyric to go with it, doesn’t mean you can’t or shouldn’t do anything else. So while you sit around moaning and your manager, if you have one, doesn’t do a god damn thing for you, I’ve thrown enough stuff they are interested in doing at them that they’ve earned a good chunk of change over the last 2 years.
And look, I don’t even disagree with you that it’s sad. But life sucks, gotta learn to deal with it or change it. I don’t have some great idea to get everyone to buy these guys’ music so until I find that great change, we found other ways that have worked out quite well so far.
Stargate write about 150 to 200 songs a year. And they have some of the biggest hits from the last 5-6 years.
And why do you think we have new Michael Jackson albums 5 years after his death ? Because he recorded tons of vocals and demo song that her never released. It’s not something new: successful artists always worked hard.
“Stargate write about 150 to 200 songs a year”
Uh, I thought that was some kind of terrible movie. Perhaps they also invent 200 band names a year?
Wait wait wait…. Is this the songwriter anonymous or the other anonymous? Because if you’re the songwriter one, the one who champions pop music time and time again, and you don’t know who Stargate is….that explains SO much. You truly are a fraud.
…or perhaps I think their music is on par with their name…
Oooooo someone’s jealous…..
Here, let me Wikipedia that for you:
http://en.wikipedia.org/wiki/Stargate_(production_team)
“I’d be careful about that stat. Eddie Cue (iTunes exec) claims that this proves that there’s a big problem in the music community; I’d say the music community no longer puts iTunes at the top of the list as they did just a few years back.”
Paul did you really say that? You don’t think there’s a big problem in the music community? You’re parsing the conversation to make a point. I think the bigger question is why are musicians not putting their music on iTunes? I refuse to get caught in, support or spread rumors like the sale of music is over. The more you say it, the more people believe it. Same thing with streaming. People aren’t saying that, pundits are saying that. We’re all parrots.
Streaming’s a bust because most people are not interested in searching for music. I am, you are, G is, but the average listener is not motivated to search stuff out. When I worked in a record store we sold a lot of music. Why? Because we knew music and made recommendations. What do you like? We didn’t need a software program, we knew our stuff and we were far better than a probability logarithm. Art is subjective, you’re not plotting an intercept line to a crater on mars.
G’s to young, but you remember going into a video rental store. Where were all the people? The new f…..ing release wall. Catalogue section DEAD. and if people were there they were looking for stuff they’d seen before.
The only thing streaming’s done is create a false perception. Everything’s there so why buy anything. Meanwhile you’ve got listeners on Spotify listening to the same shit over and over. Don’t confuse the average listener with who you are to make a point or tell me about your friend Louise. The average listener expands their universe by hearing stuff presented by others, not trailblazing. Why do you think social media works and how do you think stuff goes viral? Is it because stuff is so good that independently tens of thousands of people get it instantly on their own? Don’t think so.
People aren’t interested in searching music? uhh, youtube??
If you post on this site you are not a typical music consumer. If you post on this site and you hear a single you like you will listen further and see if you want more.
We are avid fans or we would not be passionate about what’s going down with music, whatever your belief.
People still love new releases, or else blogs, especially indie blogs, would be dead. Pitchfork wouldn’t be the most influential music site by a long shot if people didn’t care about new releases. The problem is it’s a single’s world now AND there’s just SO much stuff that people move on to the next thing or they fall behind. So albums aren’t given the attention and the best songs are the only thing that matters to most As a fan of albums, it is certainly sad, but also 90% of artists who think their album is some totally cohesive work of art are kidding themselves. For every Dark Side of the Moon there’s a million albums that think they’re DSOTM and another million that are just a collection of the songs whoever wrote in a given timeframe. People have clearly given into the 3-4 minute pop song ideal for decades, so not sure why the idea of singles being more important than albums is now some horrible devolution.
And for the record, I’m 28, Paul is probably less than 5 years older than me, and I grew up going to Blockbuster and whoever was before that….MegaVideo maybe?
And last, people were buying less and less music before streaming become popular. And it’s not even popular yet.
“probability logarithm”
When you say stuff like this, it doesn’t make you look cute. It makes you look like a blithering fool.
But most of the great records, that endure the test of time like Revolver, Exile on Main Street, Born to Run, Joshua Tree, Hejira, Who’s Next, Dark Side of the Moon, Under the Table and Dreaming, Steely Dan, etc., etc.
The listed great albums are aged: 20 years, 25 years, and the rest 30-45 years old. In pop culture terms, that’s between 6 and 15 generations of high school and college kids. One might as well complain that live touring won’t support 15-member big jazz bands any more. You know, George Gershwin doesn’t sell like he used to, either.
All the listed albums except Dave Matthews are from the era when pop music was much more central to the culture.
Valid point. But then again most of these records have been selling to young people since they were released.
What were you specting? After all the stupid free music apps? Silly note tho.
I believe Spotify’s biggest problem is their marketing. I’ve taken surveys of classes I teach and my students, 18-24 yr old’s on average barely know Spotify exists. I has 1 student this past quarter that bought a CD the the past year. The rest download mix tapes, buy bootlegs, youtube/soundcloud, pirate bay or if all else fails, buy from iTunes. Spotify should be taking off as the next revolutionary push in the music industry. There’s no for it not to, it’s iTunes on demand.
This propaganda of low quality “shitty” mp3’s and old fashioned values around the good ol days needs to be discarded with the quickness.
If Spotify had the 800 million members that iTunes had, I don’t see how it wouldn’t produce a better paying and better long tail profit than what iTunes can deliver now. Spotify might produce 3 times less the profit of iTunes, but that’s with 30 million vs. 800 million.
Or am I missing something here???
No, you’re not missing anything. You’re 100% correct.
But change is scary for some. Many, on here.
“But change is scary for some”
…while it’s necessary for others. 🙂
And I personally can’t wait for the old audio-only services to be replaced by an entirely new video site.
That’s the future…
Sure, neither can I. Audio streaming, video streaming, combination, who gives a shit. Point is it won’t be people buying downloads.
See you did it again. You just can’t help yourself. You should get a sign and take it to gigs. Oh wait, did you say you sold music at gigs or was that Ari?
I take it back. Just get a sign that says “Don’t buy our music at the break”. I’ll make it for you.
Now you’re going to come back and say downloads, aren’t you.
They all bring music (except one because they don’t have a finished product yet), but actually selling it is a different story….They are on stage, and in many different ways say “hey, we have physical music, go buy it” and sometimes it works, sometimes it doesn’t.
That comment was not me cheering for the decline of sales; it was me responding to someone else who hates Spotify while at the same time praying for a different, better type of STREAMING service.
“it was me responding to someone else who hates Spotify while at the same time praying for a different, better type of STREAMING service”
That would be me. 🙂 Here’s the reason for the paradox:
This is not black and white. I would use Spotify if it were 50 times bigger. But it won’t be. And I know this is a boring mantra to you, but the reason for Spotify’s failure is that people want video.
So launch a free and open alternative to YouTube — or add video to Spotify — and people will come.
Right, and I was agreeing with you, believe it or not. It would be great if some non-YT platform with higher-end Spotify payouts became the norm. Even with my argument that audio-only is far from dead, I’d be just as happy as you if something that integrated both killed Spotify.
I’m not sure if we have been around this before, but what keeps Spotify from adding video to its service?
Things got a bit more complicated since the majors signed with YT, but licensing should not be a problem. So is it just a matter of storage, or what?
I don’t believe in another VEVO, but movies and user generated content could follow if Spotify opened its doors for music videos now.
I’d imagine it’s storage, but part of me also assumes that video is a long-term plan. I can’t imagine they’ve never discussed it, so there’s either some enormous cost they don’t feel like taking on (or they figured YT is an unbeatable for) or it might be planned to roll out in the future.
Beats Music is going to be a very different animal. All we be revealed………..soon.
The reason I’m rooting for Beats Music is the same reason I’m rooting for the demise of Spotify. If you do some research the plan for Beats Music is to link intuitively with iTunes to sell music.
They can link intuitively all they want, doesn’t mean it will lead to anything. How unintuitive is iTunes? You open it, search and click buy. Not sure how much easier someone can make something….
iTunes integration with a streaming service is like trying to sell tickets to season pass holders.
Good analogy.
Let’s ask the pro-streamers why such an arrangement would make any kind of sense…
It doesn’t, which is why I said it wouldn’t matter in a previous comment.
“iTunes integration with a streaming service is like trying to sell tickets to season pass holders.”
Now that was good.
Just witness iTunes Radio, which had negligible impact on iTunes download sales. It’s hard to sell a-la-carte pancakes at the breakfast buffet.
Pretty clear who you are. Spotify has too many links to Napster to not understand it is simply a work around for piracy. Your expressed interest in the consumer with little regard for creators or rather your misguided belief in a new compensation model that can replace people paying for music is dillusional.
My efforts here were never to restore profitability to the music industry, but rather fight for the individual and their ability to earn a reasonable wage for their work. Your fight is for mediocrity.
Yeah, pennies on the dollar.
Yes, and instead of about 2% of your fanbase giving you money, you’d have 100% PLUS whatever amount of random listeners from press/marketing. Not to mention, some of that original 2% will still buy vinyl or something, so it’s not a 100% switch out.
One of my acts had a single premiere that got 75K plays from an embedded streaming link. Think it would have gotten that with an iTunes link?
People are paying for music in these streaming models. Either they are paying a monthly fee, or they are paying with their time (advertisements), which yes, has substational monetary value.
800M will never and ever happen to all streamers combined. It includes web Radio.
If it does subscription rate will average $3.5 and that will make $35 billion dollar industry.
Just remember that inflation adjusted 1999 equals today $56 billion
Also remember that 800M subs will shrink current Radio revenues from $43 to less than $10B
Wrong business models. MUSIC HAS TO BECOME MERCHANDISE AGAIN and be be monetized at the discovery moment. We need new fair use act to go from 14B in 2014 to $100 billions by 2020.
Google the biggest opponent web regulation would be the biggest benefactor of this minor adjustment.
50B YouTube as hub of new music industry is the the fastest route to 100 billion dollar annual revenues.
How can you be so sure it won’t happen??
How does someone know what they want if they’ve never even seen it? © Jobs
Spotify is cool, once you can get someone to go down the rabbit hole. They have yet to be effective in spreading the gospel.
How is this surprising? It’s 2014. Streaming is kind of a big deal right now.
So was soccer, until we lost.
When you extrapolate the inflation costs of food, fuel and utilities it in inversly proportional to the reduction in entertainment expendetures. People can’t buy a CD or a download if they can’t put gas in the car.to get to work. In the mean time the EPA shuts down a coal powered electric plant a week, the BLM confiscates more ranching land for the UN agenda 21 and the privately owned and operated Federal Reserve prints fiat debt currency in your name to pump up its own proxy stock market invesments while devauling your currency. When you take a step back and look at the big picture you realize that we’re all royally screwed as the economy is in free fall with no bottom in sight. The only way to clean this house is with a fire.
People can’t buy a CD because they spend 500$ every 18 months for a new smartphone, then you add the monthly bill, apps, an iPad here and there and some subscription channels. When I was kid, there was no smartphone, no monthly phone bill, no apps, no subscription. Pocket money will go into buying CDs, VHS and later video games.. Now go to store and watch parents buying iPhone to their kids with a 50$ monthly plan. How many money will be left to those kids to buys other things ? Well, not much. And adults will buy iPhone with “all you can use” 100$ monthly plans. Again, that’s money they won’t spend on other things.
Spot on comment. The priority for kids now is a decent phone. After that they have no money left. So those phones have to come with a streaming service pre installed. That’s what made the iTunes app store take off!
Maybe, Beats Music will do the same when that some on the new iPhone.
We have see glimpses if this with the MUVE (Cricket) tie up in the US. We have seen good penetration in the UK since Vodaphone linked up with Spotify.
The big mobile players, the streaming stores and the PRO’s need to sit around a table and fix this GLOBALLY.
Why isn’t anyone talking about the fact that when consumers go to pay for a song expecting it to be .99 and instead see the insanely un appealing $1.29 price point they just say, “aww fuck it” and leave?
That is what’s happening in a nutshell. Label greed does it again.
IMO that is probably just as likely as anything else..
like it or not, the $ of music has been devalued..
As Mark Twain once wrote, there are three kinds of lies: lies, damned lies, and statistics. 😉
I have not bought one thing from iTunes since they stole all my music off my phone. I had over 4,500 songs – mostly my own CD’s – but a lot of downloaded and payed for music. The last time I logged in – about when the chart shows going from positive to negative – to sync my phone all my ringtones and most of my music disappeared. Then I got an email asking for $25/yr to get my music back. That is a piddly amount I know – but it is the principle of the thing. Luckily I’ve got an old iPhone hanging around with about 75% of my music – yeah – the old stuff, So their new policy really digs at the new artists. So sad. I think it’s a money and a power thing (what isn’t!) but until they figure it out I’m really pissed and getting tired of my old music.