In Wednesday’s New York Times, Eric Pfanner reports on a possible sign of revival in the music industry.
The music industry, the first media business to be consumed by the digital revolution, said on Tuesday that its global sales rose last year for the first time since 1999, raising hopes that a long-sought recovery might have begun.
The increase, of 0.3 percent, was tiny, and the total revenue, $16.5 billion, was a far cry from the $38 billion that the industry took in at its peak more than a decade ago. Still, even if it is not time for the record companies to party like it’s 1999, the figures, reported Tuesday by the International Federation of the Phonographic Industry, provide significant encouragement.
For years, the music industry’s decline looked terminal, with the record companies seemingly unable to come up with digital business models tha could compete with the lure of online piracy. Last year, however, digital sales and other new sources of revenue grew significantly enough to offset the continuing decline in CD sales.
“At the beginning of the digital revolution it was common to say that digital was killing music,†said Edgar Berger, chief executive of the international arm of Sony Music Entertainment. Now, he added, it could be said “that digital is saving music.â€
Digital revenue comes in a variety of forms. Sales of downloaded singles and albums, from services like Apple’s iTunes, continue to grow. More promising for the industry, however, are subscription-based offerings, including Spotify, Rhapsody and Muve Music. The number of subscribers to services like these grew 44 percent last year, to 20 million, the federation said. Several new entrants are expected soon, including subscription services from Apple and Google, promising additional subscriber fees and licensing revenue for the record companies.
