The music business isn't the most stable of industries. Back in 2000 consumers worldwide started ditching their CDs and began downloading music instead, sparking a decline in music revenues that has lasted almost two decades.
Now though, after years of falling, revenues from music are finally starting to rise once more thanks to paid streaming services such as Spotify and Apple Music, according to Bloomberg technology.
Both growth and revenue have yet to return to pre-2000 levels, but the development is reassuring for an industry that has been sceptical of the low per-track revenue provided by streaming services. It remains to be seen whether or not this will have an effect on artists' slight royalty payments.
Digital woes
The switch away from physical media was problematic for a couple of reasons. The first problem was that paid music was initially hard to find online.
The majority of artists were wary of providing their music for download, and the result was that the only option for fans was to download music illegally.
Then, when artists finally got around to making their music available through services such as iTunes, they found that the margins on digital downloads were much narrower than on physical sales.
Ad-supported streaming
But the music industry's problems aren't entirely over. Users still overwhelmingly prefer their music to be ad-supported on streaming services, rather than paying a monthly subscription.
Just one-quarter of Spotify's users were paying for the service at the beginning of this year, and other services, such as Pandora, have yet to launch a paid version of their offering.
Via Bloomberg
