Global music revenues grew at the fastest rate in more than two decades last year, as the streaming revolution more than made up for the plummeting popularity of CDs.
Worldwide recorded music revenues surged 9.7% to $19.1bn (£14.6bn) in 2018, the fastest rate of growth since at least 1997 when the Oasis album Be Here Now topped the UK albums chart. It is the highest level of income earned by the music industry since 2006, when CD sales accounted for more than 80% of global revenues of $19.6bn and when streaming income was non-existent.
Now the tables have turned, with revenue from music fans using services such as Spotify, Apple Music and Amazon Music surging by 34% year on year to $8.9bn, accounting for 47% of the total global market for recorded music. The sale of physical formats, primarily CDs, fell by 10% to $4.7bn, accounting for 24.6%.
Music industry body the International Federation of the Phonographic Industry (IFPI) said revenue from paid subscriptions accounted for 37% of global music revenues last year. Income from ad-supported music, such as commercials running around YouTube music videos, accounted for a 10th of the global total.
The music industry argues that YouTube is not paying its fair share back to labels and artists compared with the billions it makes exploiting them. YouTube says it paid $1.8bn in ad revenue to the music industry last year.
“We are campaigning for music to be fairly valued in all its forms,” said the IFPI chief executive, Frances Moore. “We are working for music copyright to be recognised and respected around the world, and we remain committed to establishing a level playing field when it comes to negotiating a fair deal for those who create music.”
Last year also proved to be a bumper one for UK video games as the global craze for Fortnite pushed revenue to a record £5.7bn.
Gaming fans spent 10% more on consoles, games, hardware such as headsets, and attending events than they did in 2017, with the biggest market driver the online-only games market.
The Association for UK Interactive Entertainment (Ukie) said digital and online revenues – from fans paying to download games or spending on items to enhance games – grew by a fifth to a record £2bn last year.
Ukie said the popularity of Fortnite and Battlegrounds helped push digital and online revenues to account for 50% of the £4bn spent on all gaming software last year, the largest part of the UK games market. It is the first time that software revenue spend, which grew 10.3% overall last year, has reached £4bn.
Games console sales rose 6.5% to £702m, despite no new platforms being launched last year, as the renaissance of devices spanning the PS4 Pro and Xbox One X to Nintendo Switch consoles continues.
