New York (AFP) – Music sales rose 5.9 percent in 2016 to mark the second straight year of solid growth on the back of a rapid expansion in streaming, the global industry body said Tuesday.
The International Federation of the Phonographic Industry said revenue from streaming jumped 60 percent from a year earlier, outpacing a significant decline in digital downloads from platforms such as iTunes and, to a lesser extent, a fall in physical sales.
Total revenue hit $15.7 billion. The 5.9 percent growth rate topped the previous year’s 3.2 percent, which had marked the first substantial expansion in the recorded music business since the jolt of online music in the late 1990s.
Music executives said that sales were propped up by the growing popularity, and competition, of paid streaming services led by Spotify and competitors including Apple Music, Tidal and Deezer.
But they cautioned that the market remained fragile, with the transformation to streaming only beginning to take shape.
“Remember, we’re only two years into our recovery after a decade and a half of decline,” Stu Bergen, CEO for international and global commercial services at Warner Music Group, told reporters on a conference call.
“We must remain alert, resourceful and ambitious. We’re no longer running up a down escalator, but that doesn’t mean we can relax,” he said.
Frances Moore, CEO of the industry federation, said it was critical for the music business to keep investing in artists, who ultimately carry the industry’s fortunes.
She also renewed calls for a global overhaul in the regulations that allow internet companies to skirt most responsibility for users’ uploads — which, music executives charge, leads to unfairly low revenue from YouTube.
Music sales expanded in almost all major markets. Latin America had the highest rate of growth at 12 percent, led by a boom in Mexico even as the region’s largest market Brazil slipped slightly.
Revenue in China soared by more than 20 percent as international music labels expand in the billion-plus country and leading local streaming company Tencent pulls in new customers.
The industry body saw the potential for major growth ahead in China, which despite its size remains only the 12th largest music market in the world.