That’s right: vinyl records are about to become a billion dollar industry. That’s the latest prediction from Deloitte, who exclusively shared their data with Digital Music News.
Looks like those beard-growing, wine-sipping hipsters were on to something. That is, a billion dollars worth of something. According to a game-smashing prediction released this morning, sales of vinyl records are set to become a billion dollar industry. That is, in 2017 after just seven years.
Specifically, sales of records themselves will reach the $800-900 million-mark, with turntables and other accessories likely throwing things into 9-figures.
+ Still a Fad? Vinyl Records Return to 1991 Sales Levels
After that, who knows how big this can go. The prediction was outlined in Deloitte’s just-issued ‘TMT Predictions’ report. “Music industry vinyl is expected to continue its remarkable resurgence, approaching US $1 billion globally in revenues for the first time this millennium,” the report declares.
“New vinyl revenues and units are likely to enjoy a seventh consecutive year of double-digit growth in 2017.”
+ 12 Things That Won’t Happen In 2017 (My Music Industry Anti-Predictions)
Actually, music industry groups like the IFPI have been counting ten straight years of growth. But hey, let’s not squabble: this is a growth spurt that keeps going, and bringing new users into the mix. And reshaping an entire music industry in the process.
40 million vs. 1 billion…
But lest we get ahead of ourselves, Deloitte is calming expectations on this format. And putting things into perspective. The report notes that total vinyl album sales topped 1 billion in 1981, a figure that dwarfs expectations of 40 million units in 2017.
Further cooling things, Deloitte also says that vinyl records will never be the main event. Instead, wax will always play second fiddle to digital, which is at the start of its own mega-explosion. According to the report, vinyl records are expected to comprise 6 percent of broader global music industry revenues of approximately $15 billion this year. “However, vinyl is unlikely to ever be music’s major growth or profit engine, with the future of music squarely focused on digital,” the report concludes.
+ What the Vinyl Records Comeback Really Looks Like…
Now here’s where the plot starts to seriously thicken. Because it turns out that the rise of streaming and vinyl records go hand-in-hand. Indeed, the latest research suggests that vinyl isn’t an alternative to streaming, it’s being powered by it. Indeed, the real uptick in vinyl records happened around 2008, which not-so-randomly corresponds with the birth of Spotify.
+ Exclusive: Patents Filed for ‘High Definition Vinyl’ Technology
Now here’s where this gets even more nuts. Because not only are streaming and vinyl linked, but patented technology is intertwining the two formats. Just last year, Digital Music News broke the story on an experimental breakthrough in Austria related to ‘HD Vinyl,’ a format that will actually link back to your streaming account. That is, on top of offering massively greater fidelity, durability, and even embedded track metadata.
Written while listening to Jamie xx, Tove Lo, and Erik Satie.
The numbers of physical copies sold would be far greater and drive significant revenue, far more than streaming will do in the foreseeable future, if the music business simply followed every on else in the entertainment industry.
Hold back new releases from low paying music streaming services for thirty days.
I buy vinyl, it’s great, but it is also expensive. I buy far more CDs than LPs. The CD needs to survive to fuel greater sales and push out much needed revenue to more artists.
The number of people over 35 who pay for streaming is tiny, why turn our backs on these buyers?
The business will continue to move to digital, but we’re leaving massive amounts of money on the table under the current marketing / distribution model.
And yes, we need to revise safe harbor legislation and make piracy less of a factor to have a healthier business for artists.
Recorded music enthusiasts/fans like to have a “real world” collection, something physical.. whether that’s vinyl, CD, cassette.
Something on the shelf that’s there for the eye to see and the ear to hear..
Problem with Vinyl:
Vinyl is a real pain to have manufactured, long delays.. often far away factories,
expensive freight, requires suitable warehousing storage space,
complexities in arranging effective retail distribution.
There are the long lead times to cover all the necessary processes involved
Artwork design and proofing, printing of labels and covers, test pressings approvals, manufacturing of the vinyl records discs, freight of stock, warehousing of stock..
This is even before you work-out how you’re going to sell the damn things..
So a 12″ vinyl album may take up to 12 months from start to end to actually having the disc’s sitting in cardboard boxes in your warehouse.
You just have to hope your artist/band is still together and building a good following as 12 months is a long time in the record business..
Digital is so fast in comparrison.
You can write, produce and master a track in a few days, knock up the artwork on
your computer and have your aggrigator have it go live in iTunes, Apple Music, Spotify
and all the other Internet stores and streamers within a few days and there’s none of the expensive and cumbersome headaches of physical product manufacturing
Of course, companies like Universal, Sony, Warner have the deep pockets,
the warehouses and the distribution pipelines to effectively move vinyl plus they
have more favourable arrangements (influence) with manufacturing plants to get
their content off the conveyer belt ahead of all the other releases.
Maybe Vinyl is a product that’s allows the majors to regain advantages over
all those pesky independents – a way to dominate the physical space when it comes
to recorded music.
Much of those sales are probably re-re-re-re-re-re-released, re-re-re-re-re-remastered albums from past decades…