The music industry is continuing its comeback according to new data from the RIAA, with recorded music revenues in the US growing 9% in the first half of this year.
As it was
Driving much of that growth was streaming, which has given the music industry a much-needed revival after online piracy hastened the demise of mainstream physical formats like CDs.
That revival has struck a chord with a particular set of investors. In recent years powerhouse investment firms, designed solely to acquire music catalogs, have been paying millions to own the rights to songs from artists such as Bob Dylan, Bruce Springsteen and Shakira, anticipating that streaming is here to stay. Given the chart above, that is potentially quite a bold bet to make.
Even the most dominant listening mediums — vinyl, cassettes, CDs and downloads — have rarely lasted more than a decade. It's hard to imagine what might dethrone streaming, but if we were writing this in the late '80s we would likely have felt the same about the mighty CD.
It's interesting that many of the back catalog deals have been for the music publishing rights. That means the rights to the lyrics, melodies and musical composition of tracks, rather than just specific recordings of songs. Bob Dylan's work is a good example of why that's often been the case — Universal Music estimate his songs have been recorded some 6,000 times. Now every use, play, stream or sample of a Dylan song means a payment for Universal.
Back In Black
Although streaming is the headline act in music these days, it's actually not the fastest growing format. That honor falls to vinyl, which — according to RIAA data — grew 22% in the first half of the year, building on the $1bn+ in vinyl revenue recorded in the US last year. Nostalgia remains undefeated.