The Recording Industry Association of America (RIAA) has released its mid-year report for 2020. This gives an overview of the economic health of the record business through the first half of the year. There are some key takeaways like music revenues continue to rise, which is good because live music has fallen off of a cliff because of COVID-19, while vinyl has overtaken CD sales for the first time in 34 years.
In the first half of 2020, music revenues grew 5.6 percent to $5.7 billion. Streaming continues to dominate, now 85% of revenue, growing 12% to $4.8 billion in the first half of 2020.
Digital downloads continue to plummet, down 22.2% from $451.5 million to $351.3 million year on year. Sync royalties only fell .3%, which is a good sign that advertising hasn’t fallen off as much as has been thought, at least for musicians.
The biggest headline to emerge from this has been the shift in physical music. Physical music sales were down 23% from the same period last year to $375.5. This is in large part due to retail shutting and venues being shut down.
The convergence of CDs and vinyl has been coming for the past few years, but if you told someone in 1998 that vinyl would outsell CDs again, they would have thought you were insane. CD sales fell a staggering 47.6% from $247.9 to $129.9, while vinyl sales rose 3.6% to $232.1.
This level of a fall off for CD sales seems a bit steep to be permanent, but the trend of CD sales dropping, while vinyl slowly rises has been going on for well over a decade. In the next 12 months as more stores open and shows return, there will likely be a pick up of CD sales, but vinyl could remain more popular than CDs. Once you move to vinyl, it is hard to go back to other formats, especially as CD drives disappear from more and more physical devices.