Online streaming services like Spotify and Apple Music are taking over the music industry as they now have the single biggest earning source, overtaking physical sales and digital downloads for the first time.
The rapid growth in streaming music services in recent years has led to a recovery in the fortunes of the global recorded music industry, which enjoyed its third year of positive revenue growth, according to a report by industry trade group The International Federation of the Phonographic Industry (IFPI).
By 2014, music sales had fallen by 40 percent to $14.3 billion in the 15 years since 1999, when the rise of music file-sharing service Napster ravaged sales of CDs and the development of download services like Apple iTunes failed to offset declines.
Last year, subscription-based streaming revenue accounted for 38 percent of all recorded music, up from 29 percent the year before, IFPI said.
Latin America and China saw the biggest market growth, with a rise in overall music revenue of 17.7 percent and 35.3 percent respectively.
Despite the healthy figures, revenues for 2017 are still only 68.4 percent of the market’s peak in 1999.
IFPI says governments should do more to tackle the “value gap” between the value created by some digital platforms such as Google’s YouTube for their use of music and what they pay those creating and investing in it.
“Things are looking good but there’s a structural fault in the system. Until we fix it, it will always be a struggle,” said IFPI Chief Executive Frances Moore.
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