The income U.K. record labels earned from streaming, physical, download, performance rights and sync in 2016 is up 5.1% to £926 million, recording the largest annual turnover in five years. Unsurprisingly, streaming enjoyed its highest growth rate since 2012 marketshare-wise, while downloads are now worth just over half what they were in 2012.
The numbers come courtesy of British record label trade body BPI, whose boss Geoff Taylor (pictured below) praised the performance and warned about the need for government intervention to ensure a robust music industry in post-Brexit years to come.
“Britain’s world-leading music sector has the potential for sustained growth in the years ahead, but this exciting future can only be realised if government makes creative businesses a priority post-Brexit,” he said.
“What does this mean? It means making sure that U.K. artists can tour freely in EU markets and that U.K. businesses can access the best talent. It means taking firm action against illegal websites that deny artists a living, and making clear in U.K. law that huge online platforms must pay fair royalties for the music they use. It also means working with industry to boost exports by promoting strong IP protection in trade negotiations with third countries.”
That £926m figure is up £44.6m year-on-year, thanks largely to a 61% rise in streaming revenues to £274m. Subscription income represents 87.1% of that (£23.6m), with ad-supported tiers repping 3.6% (£9.8m) and video streaming 9.3% (£25.5m). We don't know how the individual streaming components compare with 2015 due to definitional changes as the IFPI only recently introduced the three-part definition. The £274m figure represents a 29.6% share in overall revenues—up 10.3% from 2015.
Physical is slightly ahead as the leading revenue stream with a marketshare of 32.2%, but streaming is expected to overtake that in 2017. Revenue from physical formats dipped 1.9% to £298m in 2016. The vinyl revival is going strong in Blighty as revenue from LP sales rose 66.5%, counting for 4.5% of total label revenues. Revenue from downloads was down 27.3% to £151m last year. The format recorded its highest rate of decline since 2012 with marketshare down 7.3% on 2015 to 23.6%.
Record company earnings from performance rights collected by PPL from the broadcast and public performance of recorded music increased by 1.8% in 2016 from £171m in 2015 to £174m, representing a market share of 18.8%. Over the same period, revenues generated from the licensing of sync music for use in film & TV, games and advertising also rose by a more modest 0.6% to rep 2.5% of the market at £22.8m.
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