ARIA 2014 wholesale figures: Streaming revenue doubled
The Australian Recording Industry Association (ARIA) has released its annual wholesale figures for 2014, showing that subscription service income doubled to $23 million, up 111% from 2013.
Services like Rdio, Spotify and Pandora now contribute to over 10% of the total market value, and while it’s less than some countries (Norway’s digital market value accounts for 80%), the figure aligns Australia’s music industry with the growing global trend of digital consumption.
In fact, following digital music revenues outstripping physical for the first time in 2014 (accounting for 54.7% of the market), digital products now make up 59% of the total market at $187.7 million.
While the report doesn’t show which streaming services are driving the growth in Australia both Spotify and Rdio had momentous 2014’s: Rdio is now available in 85 countries and in a statement given to TMN last year Spotify Australia said its revenue was increasing by “around 70% year on year.”
Speaking to TMN this morning, Colin Blake, Rdio General Manager Australia and NZ, said he sees the figures as a “mixed result” and noted the contribution from the advertising industry, which is fast adopting streaming as an avenue to drive products.
“Ultimately I look forward to receiving this information in a January sometime in the future where we’re seeing top line growth for the Australian music industry and streaming being the largest contributing factor to that.
“That said, it’s exciting to see that streaming revenues have risen,” Blake added. “I believe that the advertising industry looking at music streaming as a new and innovative product is a key part of the continued growth.”
Blake also told TMN he believes a greater understanding from artists is needed to continue streaming’s growth in 2015.
“As per the recent reaction and comments from Taylor Swift and other artists the key for this to work seems to be support and understanding for the correct ad funded model types,” said Blake.
“Our curation-based radio style “Stations” ad funded product is what we believe will ultimately be the right way to grow this side of the revenue equation,” he continued. “Of course, consumers seeing the fantastic value of a fully curated and on-demand experience being worthwhile to pay for a subscription is the imperative outcome that the industry also needs to pursue.”
This year will see at least two new streaming services enter the local market with Apple’s Beats Music and YouTube Music Key.
Other figures released in ARIA’s report show another notable increase in vinyl sales; in 2013 the market reported an increase of 77% and the latest figures show an impressive increase of 127%. Conversely, what hasdecreased is revenue from the overall digital market, which is down 2.36%, and an 18% decrease of physical sales, marking an overall nosedive of 9.62% in annual recorded music revenue – still slightly better than 2013’s 11.6% decrease.
In 2014, the official ARIA charts saw a notable increase in local music. 16 Australian singles and albums topped the ARIA charts and 18 local acts were included in ARIA’s end-of-year Top 100 Singles chart (five more than 2013) and 36 were included in its Top 100 Albums chart (nine more than the previous two years).
Dan Rosen, ARIA Chief Executive Officer, said in a statement, “The remarkable success of Australian artists in 2014 is exciting news for the future as the music from our home- grown talent is enjoyed by music fans here and around the world.
“As the industry continues to transform itself, we remain committed to embrace our digital future. Our goal as an industry is to make it easier for music fans to support the artists they love by developing innovative new ways to sell music. The continued growth in the subscription market shows that the local music industry is leading the way in streaming digital content.”
Read more in The Music Network here.