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UK record industry revenues grew 12.8% in 2021

By | Published on Wednesday 16 March 2022


UK record industry revenues grew by 12.8% in 2021 to £1.26 billion according to new figures from trade body BPI. The ongoing streaming boom was behind much of the growth, of course, although the vinyl revival also continues, plus CD sales, sync, broadcast and public performance all recovered to one degree or another, those being the recorded music revenues that were negatively impacted by COVID-19.

In the streaming domain, the UK record industry’s cut of subscription sales remains by far the biggest revenue generator. Premium streaming revenues were up 13% to £734.5 million. Though the monies generated by ad-funded streaming also went up last year. Ad-funded audio streams grew by 15.7% to £49.1 million, while income from ad-funded video platforms like YouTube were up 22.6% to £53.7 million.

In terms of physical products, the vinyl revival continues at quite a pace, with the revenues from vinyl sales in 2021 up 34% year-on-year to £115.9 million. Though CD revenues are still slightly ahead at £117.2 million.

CD sales, which have mainly been in decline for years, actually went up in 2021 by 1.4%. Although that’s likely because in 2020 the drop in CD revenues was partly due to COVID shutting down the high street for some of the year. Total CD monies for 2021 were still down on 2019.

Talking of the COVID impact, in the main the record industry wasn’t hugely hit by the pandemic in revenue terms, because premium streaming is by far the biggest revenue generator and it wasn’t affected by any of the shutdowns. However, some revenue streams were affected. Alongside CDs, sync, broadcast and public performance – all three usually growth revenue streams – were all also down in 2020.

That was because studios and ad agencies put TV, movie and advertising projects on hold during the first lockdown; commercial radio stations were impacted by the COVID-caused wobble in the advertising sector; and many of the businesses that buy licences to play recorded music in public were shut at various times during the year.

All those revenues started to recover in 2021. Sync was up 47.6% to £30.8 million, an increase on 2019 as well as 2020. Monies from broadcast and public performance – which come through the collective licensing system – were up 10.8% to £117 million, although they are still to get back to 2019 levels, when income was £135.9 million.

If you’re interested in such things, the approximate split of total monies by revenue stream (approximate mind, because any maths geeks out there might notice these stats don’t add up to 100%) is as follows: streaming (66%), CD (9%), vinyl (9%), broadcast and public performance (9%), other digital (3%), sync (2%) and other physical (1%).

Of course, with the ongoing debate about how streaming monies are shared out across the music community – with many arguing labels in particular get too big a slice of the digital pie – it’s obligatory for the record industry these days to insert a little gloom into other wise up beat stats.

The current tactic is to point out that, despite all the recent growth, the record industry at large is someway off getting back to the revenues it achieved in the good old days once everything is adjusted for inflation.

Last week, the Recording Industry Association Of America pointed out that – although, on one level, the US record industry’s retail revenues are now exceeding what was made at the peak of the CD era in 1999, when adjusted for inflation current revenues are actually 37% down on that peak.

The BPI’s insertion of gloom is a stat comparing 2021 revenues with what was made in 2006, some years into the 2000s slump in CD sales. By its maths, when adjusted for inflation, total record industry revenues in 2006 were £1.63 billion, ie £368 million higher than last year’s monies.

Which is an interesting comparison to make. Though those who claim that labels keep too much of the digital pie would still argue that the profit margin is higher on digital compared to physical; and that catalogue accounts for a ever bigger portion of revenue in the streaming age, and many labels pay much lower artist royalties on older music.

Plus many labels sign new artists slightly later and/or also share in artist revenues beyond recordings, thus reducing the label’s risk when investing in new talent.

You can make of all that whatever you wish. But the main takeaway here is that the key record industry trend of recent years continues – ie premium streaming is still very much in growth, and that is powering the ongoing growth of the wider recorded music market. Hurrah!

And now a quote from BPI boss Geoff Taylor: “The UK music market’s return to growth has been driven by streaming – especially streaming subscriptions, which grew by 13% last year and made up 88% of streaming revenues and 58% of total revenues. After a tough few years we are also pleased to see growth across the sector, including in physical formats, sync, performance rights and beyond”.

Alluding to the economics of streaming discussions and digital pie debate, he goes on: “This growth yields important benefits for the broader music community, including greater remuneration to a wider base of artists and additional investment by labels in new talent”

However, he adds, “it is important to remember that even today we still have yet to fully recover from years of decline and that, in real terms, we remain a much smaller industry than fifteen years ago. We urge the music community to join together to continue growing the market. For example, by helping British music secure the largest possible share of streaming growth abroad. That will be an effective way to maximise the success of British music creators and the ecosystem that supports them”.

Record industry trade bodies around the world have been publishing their 2021 stats in recent weeks. Yesterday the French organisation SNEP confirmed that recorded music revenues in that country were up 14.3% last year to 861 million euros. As in the UK, subscription streaming is powering much of that growth, with digital revenues at large up 13% to 506 million euros. Although physical was also up in France last year, by 21%, as were monies from broadcast, public performance and sync.

Next week the International Federation Of The Phonographic Industry will publish its big report that brings together stats from across the world.