While it may be hard to believe for some, considering how long it has been since we were all going out to the store to buy albums, streaming revenue has finally overtaken CD sales. According to data released by the Recording Industry Association of America (RIAA), US streaming revenue hit $1.87 billion last year compared to the $1.85 billion generated in CD sales.
While digital download sales, the recording industry’s biggest earner, fell 8.7% to $2.58 billion, streaming and ad revenue from the likes of iTunes, Spotify, YouTube, Vevo, Pandora, Sirius and others jumped up 29% year-over-year.
It is clear to see that with a 27% jump in total industry revenue share, streaming services in particular are starting to gain steam and that listeners are shifting over to subscription based options over digital/physical copies more and more. Both paid subscriptions and free-add-supported services like YouTube both saw large growth at 25% and 37% respectively. However, while paid subscription services brought in almost $800 million in revenue, the freemium model is still only generating a modest $295 million.
Despite the good news for streaming/ad-supported services and its advocates, music sales as a whole dropped 0.5% in the US to $6.97 billion across 2014.