October 22, 2014

2014 Is The First Year Ever With ZERO Platinum-certified Records


While there were certainly a number of great albums you need to have from this year, 2014 will mark the first year since its inception in 1976 that no artist’s album will be certified as platinum from sales. The award is given by the RIAA to mark one million units sold, and with only a few weeks remaining in the year, no album is even remotely close to making the threshold.

The two records nearest the magic number are Beyonce’s self-titled album and Lorde’s “Pure Heroine,” but neither have even crossed the 800,000 mark, with sales of both having tapered off months ago. 

There is one caveat, and that is the fact that the soundtrack to the animated film Frozen has moved well over three million units; but it being a soundtrack and not a single-artist release places it into a slightly different category.

Yet the year is not a complete wash, as 60 individual songs have been certified as platinum, and this is a clear reflection of the overall shift that the industry has made back to a singles-based focus. Thanks to digital downloads, buyers are no longer required to purchase an entire album, but when compared to last year, the number of platinum-certified singles is still down more than 20%.

The remainder of 2014 is rather bleak in terms of world-wide artists that could move massive units in a short time, as the only possible shot will come from Foo Fighters’ “Sonic Highways;” but it’s been nearly a decade since that band achieved such commercial sales success. Given that reality, it’s safe to say that in nearly every aspect, 2014 will mark the most disappointing and dismal year ever in terms of mainstream music sales.

Many will be quick to blame the rise of streaming music services, as a large number of industry executives claim that this discourages the purchase of full albums and even singles to an extent. 

In fact, this was what many blamed for 2014 marking the lowest album sales since SoundScan tracking began 2014 in 1991 just a few weeks ago. When these numbers were released, it was the first solid indication of how uninspiring mainstream releases have been throughout this year, as those two previously mentioned albums that are closest to platinum status were both released in 2013.

As the traditional music model changes more and more, the industry must get out of the mud and admit they have to make massive adjustments in their sales approach if they wish to survive. With the reality that songs can get millions of streams and video views, yet only sell tens of thousands of copies, the old model is no longer relevant, and when the big labels collapse, they’ll only have their arrogance and ignorance to blame.

Joel Freimark hosts a daily music-related webseries HERE and you can follow his daily music musings and suggestions here as well.

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With thanks to Death and Taxes

Industry pins hopes on streaming subscribers as iTunes store sales fall 

DIGITAL music sales at Apple’s iTunes store have fallen 13 per cent to 14 per cent worldwide since the start of the year, according to people familiar with the matter, underscoring the fragility of the music industry’s nascent recovery. 
The dive in download sales is stark compared with a much shallower dip last year. Global revenue from downloads fell 2.1 per cent in 2013, according to the International Federation of the Phonographic Industry, but that decline was offset by increases in revenue from ad-supported and subscription streaming services, resulting in overall digital revenue growth in most markets last year.

Factoring in CD sales, which have been plunging for well over a decade, overall music sales in most of the world held steady last year. Japan was an exception, with steep drops in physical and digital sales alike.

Worldwide revenue from recorded music totalled $15 billion in 2013.

The plummeting download numbers help illustrate why Apple bought the $10-a-month subscription streaming service Beats Music earlier this year, as part of its $3 billion acquisition that included headphone maker Beats Electronics. Apple is rebuilding Beats Music and plans to relaunch it next year as part of iTunes, according to a person familiar with the matter.

Apple is the biggest seller of music in the world, physical or digital. Its dominance over other download stores is especially pronounced, according to music executives.

Some record company executives worry that their industry could lurch back into decline after several years of relative stability, should download sales decline faster than streaming growth accelerates.

A key part of that equation, executives say, is persuading enough users of online music services to pay a monthly subscription fee, usually $10 a month, rather than stick with free versions that carry advertising and generate much less revenue for record labels. 

Spotify AB offers such a free, ad-supported option; Beats Music does not.

In the US, recorded music sales are nearly 50 per cent below their peak in 2000, though they’ve been essentially flat for the past few years. This year’s decline in global iTunes music sales mirrors domestic declines.

Revenue from US download sales fell 12 per cent in the first half of 2014, according to the Recording Industry Association of America. But a 23 per cent jump in paid-subscription service revenue helped overall digital revenue increase slightly to $2.2 billion in the first six months of the year.

The number of digital albums sold in the US so far this year — on the upswing a year ago — is down more than 11 per cent, while digital track sales are down 13 per cent, according to Nielsen SoundScan.

Nielsen Entertainment analyst Dave Bakula chalked up the declines mostly to “a shift in the way consumers are consuming music,” noting that total streams on services such as Spotify and Pandora Media Inc. were up 46 per cent for the year to date, compared with the same period last year.

Streaming services now account for nearly one-third of the revenue from recorded music in the US, according to the RIAA.

The relative trajectories of downloads and streaming vary widely from market to market.
In Japan, the second biggest music market, there is almost no streaming business to speak of.

In a handful of smaller markets including Sweden, streaming is almost all there is; paid downloads are virtually unheard of.

Despite the slowing US music sales, Apple reported this week that global iTunes sales — including movies, apps and books — increased to $4.6 billion in the third quarter, up from $4.3 billion in the same quarter a year ago.
Apple didn’t break out figures for music sales.

Another factor potentially weighing down digital sales could be this year’s album release schedule, which features bigger end-of-the-year releases than last year’s, many of them by artists with young, digitally savvy fans, said Nielsen’s Mr Bakula.

Taylor Swift’s forthcoming pop album, “1989,” is slated for release next week and is expected to be one of the year’s biggest sellers.

British boy band One Direction and hip-hop star Eminem have albums due out next month. Some of the most notable releases in recent weeks, by contrast, have been albums by country heavyweights Florida Georgia Line, Blake Shelton and Jason Aldean, which tend to sell more physical copies and fewer downloads than other genres, said Mr Bakula.

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