Broadband News

Growth in digital music revenue helps music industry in difficult times

The debate over file sharing and the music industry is characterised by often diametrically opposed points of view, it is into this climate that the BPI has released trade income figures for 2011, which show good growth in purchasing of music through digital channels and subscriptions to streamed music services.

"It is highly encouraging for the long-term prospects of the industry that the pace of digital growth continues to accelerate. British labels are supporting a wide range of innovative music services and music fans are embracing digital like never before.

The record industry has continued to invest heavily in discovering and supporting outstanding British talent, which has helped sustain revenues in the face of difficult economic circumstances."

Geoff Taylor, BPI Chief Executive

The total revenue (which excludes income from broadcast and public performance licensing) for 2011 was £795.5m, a drop of 3.4% compared to 2010. Income from sales of physical media dropped 14.1%, but online media grew 24.6% to £241m, physical media accounted for £513.8m. Subscription sites such as We7, eMusic, Spotify Premium grew by 47.5% to £24m and ad-supported sites (e.g. YouTube, We7) showed a small drop of 1.4%, but still generated £10.7m.

The growth in digital trade income is increasing year on year, and demonstrates two things, that lots of people are willing to pay for content, and that the variety of fully legal online sources for content is improving. The cross-over point for when digital media will overtake physical media is a couple of years away, but as the economy picks up and more young people who have grown up with digital media acquire more disposable income it seems likely to not be many years away.

One of the reasons for lower revenue from digital content has been attributed to the ability for consumers to buy just two or three tracks from an album, rather than the whole album, but interestingly the biggest growth in digital content was for albums up 43.2% to £117.8m, which is close to the revenue from singles at £120.5m.


What about profits? Revenue loss could be meaningless - if revenue is lost in physical but gained in digital then costs are less, which may mean a net increase in profit year on year.

Either way the industry is far healthier than they would have you believe, in spite of all the 'evil pirates'.

  • TWeaKoR
  • over 9 years ago

They created file-sharing as it is today, they just want to control the internet.

  • otester
  • over 9 years ago

Post a comment

Login Register