My Thoughts on Technology and Jamaica: @RIAA says Streaming beating CD Sales as HD Audio Physical Digital Music makes comeback

Sunday, March 22, 2015

@RIAA says Streaming beating CD Sales as HD Audio Physical Digital Music makes comeback

Streaming Music is now gaining rapidly on Physical Digital Music Purchases and Digital Downloading, which are holding on but slowly dying as stated in my blog article entitled “RIAA Stats on Music Streaming – Why 4G LTE and Cheaper Cloud Storage means downloads extinct”.

Now, more recent stats from the RIAA (Recording Industry Association of America), Streaming Music is slowly set to make Physical Digital Music Purchases and Digital Downloading extinct as well.

At least based on Revenue from Streaming vs Physical Digital Music Purchases as stated in the article “Music labels are reportedly pressuring Spotify to limit free streaming”, published March 21, 2015 06:14 pm By Dante D'Orazio, The Verge.
Initially it was killing downloading, based on statistics from the Music Trade group, the RIAA (Recording Industry Association of America) for the first six (6) months of 2014 as stated in my blog article entitled “RIAA Stats on Music Streaming – Why 4G LTE and Cheaper Cloud Storage means downloads extinct”.

So why is Streaming gaining popularity so rapidly? And is the profit engine everyone claims, despite lower revenues due to Free Streaming? First the RIAA stats!

RIAA says Streaming is taking over – Downloads and physical media still king as Streaming Rises

RIAA stats as detailed in “Streaming Music drowns out CD sales in US for the first time”, published March 19, 2015 6:22 AM PDT by Joan E. Solsman, CNET News cover Music sales under several categories:

1.      Streaming
2.      Digital Downloads
3.      Physical Digital Music
4.      Synchronizations e.g. Apple iCloud, Amazon Cloud Drive
5.      Ringtones and Ringbacks

According to Music Sales stats from the RIAA for 2014:

1.         US$6.97 billion in Total Music Sales
2.         US$1.87 billion for streaming Music Sales
3.         US$1.85 billion for CD Sales
4.         US$2.58 billion for Music Digital Downloads

Broken down into percentages, that appears as thus:

1.      0.5% decline in Total Music Sales
2.      29% increase in streaming Music Sales
3.      12.7% decrease in CD sales

Currently as it stands for 2014, the RIAA estimates the contributions of the four (4) segments to the Music Revenue Pie as thus:

1.      37% is Digital Downloads
2.      32% is Physical Digital Music
3.      27% is Streaming
4.      3% is Synchronizations e.g. Apple iCloud, Amazon Cloud Drive
5.      1% is Ringtones and Ringbacks

This is vividly shown in the pie chart below:

Streaming is apparently on a roll, thanks to the gradual expansion of 4G LTE (Long Term Evolution) services across the US of A and cheaper Broadband Internet such as AT&T U-Verse, Verizon Fios and Google Fiber as explained in my blog article entitled “AT&T launching 4G LTE powered Wi-Fi and expanding AT&T U-Verse - AT&T offensive as Google sprouts 1 Gigabit IEEE 802.11ac Wi-Fi Protocol as Jamaica catches up”.

RIAA says Streaming beats CD Sales - Why Streaming needs to make more money for Artiste to maintain momentum

The Streaming world is made up mainly of the following services:

1.      Apple's Beats Music
2.      Pandora
3.      Sirius XM
4.      Spotify
5.      Vevo
6.      YouTube

The contributions to Music Industry revenues have been gradually rising, a fact that has not gone unnoticed by Industry watchers:

1.      27% in 2014
2.      21% in 2013
3.      5% in 2010

Meanwhile Digital Downloads and Physical Digital Music have been on a gradual decline:

1.      40% of Music Sales was Digital Downloads in 2013
2.      32% of Physical Digital Music was Digital Downloads in 2013

Good to note here that Physical Digital Music covers the sale of CD's, DVD's and Vinyl, with Vinyl seen a peculiar renaissance among Millennials (ages 18 to 28) thanks to the Hipster trend of liking Nostalgia based on the statistics from analyst Statista as noted in my blog article entitled “Statista projecting Vinyl Records to breach 7 million Sold – Vinyl Record Pressing Renaissance by Hipsters for owning all things Luddite”.

Even in Jamaica, Vinyl records of original sounds are in high demand, with collectors looking for that authentic sound travelling thousands of miles just to add that rare LP to their collection as noted in the article “Vinyl Records Enjoying A Resurgence In Sales”, published Sunday March 22, 2015 by Roy Black, The Jamaica Gleaner.

So it's possible that CD's too, again driven by Millennials love for better quality Music.

This possibly exists due to better designed Portable Blu-Ray Players that offer even higher density HD Audio Music based on Quartz Crystal as predicted in my Geezam blog article entitled “Blu-Ray Disc Association at IFA says 4K Blu-Ray Disc coming in 2015”.

Streaming needs more paying Subscribers – Artiste flee as HD Audio Physical Digital Music makes a comeback  

Still, for streaming to grow, Revenues need to increase as popular free steaming services like Spotify need to turn freeloaders into paying customers as noted in the article “Music labels want less free Music on Spotify”, published March 22, 2015 By David Nield, Digitaltrends.

Even Jamaican Promotes are complaining about the low level of Revenues from Streaming websites as noted in the article “Streaming sites hit sour note with local Musicians”, published Sunday, March 01, 2015 BY STEVEN JACKSON Business reporter, The Jamaica Observer.

US$295 million in revenue, which has grown by 34% is basically chump change, accounting for a mere 4.23% of the overall Music Sales revenue pie and are not even worth mentioning. So too is the revenues of Paid subscription services e.g. Spotify Premium, Rhapsody and Beats Music, which are bringing in US$799 million despite an increase in Music Sales of 25%.

Jamaicans and Streaming revenue - HD Audio Physical Digital Music comeback as Piracy is the Problem

Clearly, Streaming is growing, with local Telecoms Providers getting in on the act by offering Music Streaming Services as noted in the article “Digicel, LIME Add Music To Product Line Up”, Published Friday January 23, 2015, The Jamaica Gleaner.

More details on their services in another article, as Streaming in Jamaica via the Telecom Providers is a growing Trend, House Tyrell of Game of Thrones Style.

Already Streaming Radio is on the rise in Jamaica, with many Web based and App based sources of streaming as noted in my MICO Wars article entitled “How to get Streaming Jamaican Radio Stations”.

But unless more Streaming Music subscriptions is being purchased Paying Customers, then more Artiste like Taylor Swift will be defecting from Streaming Service like Spotify as noted in my blog article entitled “@TaylorSwift13 leaves Spotify – How Spotify’s continues to give 37.5 million users Globally Free Music who need to pay for Music Streaming”, putting pressure on them to solve the problem.

And with that may come a reversal of the Streaming tend as Millennials fall in love with older Physical Digital Music and Digital Downloading models.

With the more recent trend of HD Audio players such as the US$1,249 Cowon Plenue 1 as described in my blog article entitled “US$1,249 Cowon Plenue 1 - The Rolls Royce of HD Audio Players defines High End Music with Sony Walkman NWXZ-ZX1 as Christmas Competition”, this may start happening, once the price comes down of course!

The REAL problem, Piracy, will only stop once ISP (Internet Service Providers) agree with the RIAA to clamp down on Illegal Digital Music and Video downloading as noted in my blog article entitled “Telecom Providers and Copyright Alert System - Pirates on Stranger Tides experience Pain au chocolat”.

More article coming on Streaming Music as Smartphone and Tablet Trend increases and 4G LTE launch in Jamaica beckons!

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