This report was published yesterday, 7th January and relates to the US music market in 2015.
It contains all sorts of interesting data but the headlines are:
Downloads fall 12.5%
On-demand streaming surges by 83.1%
Vinyl LP sales increase 26%
Radio remains the top source for music discovery
Fascinating and to an extent predictive for books.
Together with the announcement at CES yesterday by Netflix that it is in substantially every market world-wide bar China and North Korea this suggests an enormous and growing consumer expectation that entertainment content be available in an access model. Even the Beatles joined streaming services in 2015. But this is not an exclusive shift towards that model. Adele’s record “25” has sold about 7m copies and is not available on streaming services. Vinyl continues its ten year growth spurt. Amazingly 18% of physical rock albums were sold on vinyl. This suggests what is happening, beyond the firm establishment of the subscription model, is fragmentation with different content performing best on different channels as consumers consume in different channels, often in parallel depending on their demographic, location and taste. To translate this to books – this suggests that multi-channel consumption is here to stay and producers need to address it by making their content widely available in all forms and business models. It also suggests that the cannibalism risk is overstated. Subscription services will not ‘eat’ the rest of the market. And this multi-channel approach in music is working – the report shows total digital music consumption up 26% and the BPI this week reports substantial retail growth in the UK in 2015 – the first since 2004.
But most interesting is the resilience of radio as a source of recommendation. Radio has more reach than any other channel with 93% of American adults listening to music on the radio at least once a week. 61% of music listeners reported using radio to discover new music (up from last year) and many of them use it in combination with streaming services. Could it be that editorial recommendation driving discovery remains the fountain head for all subsequent consumption in music? But where is the comparison to books… social recommendation like Goodreads? We are not so sure but we are convinced that focus on the ‘radio of books’ is crucial to the industry.