The Music Industry Is Bigger Than You Think [STATS]

image from 4.bp.blogspot.com This guest post comes from Bobby Owsinski, producer, author and social media advisor who blogs at Music 3.0.

Whenever someone mentions the phrase "the music industry" we immediately think of record labels and music sales, be they via a digital file, CD, vinyl record, cassette or some other method where we listen to songs. The business is a lot bigger than that, especially if we look at all the different categories.

click on image above to enlarge

The IFPI (the world-wide music industry trade association), recently released some figures from 2010 which shows the real reach that the business has. Here are the following revenue streams of the world-wide music business, from highest to lowest:

  • $32.5 Billion: Radio advertising
  • $27.6 Billion: Recorded music retail sales
  • $25.0 Billion: Home Audio systems
  • $24.2 Billion: Portable digital players
  • $21.6 Billion: Live Music
  • $16.4 Billion: Music Instrument sales
  • $9.0 Billion: Music and television magazine advertising
  • $4.8 Billion: Publishing
  • $1.7 Billion: Performance rights

As you can see, it's a huge industry worth $168 billion. Sure, there are a lot of facets to it, but it just goes to show that there are also a lot of consumers out there who are still willing to part with their cash in exchange for something to listen to, play or enjoy music with. Don't believe what you read about the music business dying. The numbers don't lie

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  1. So happy to see someone who could break it down. My own observations made me think this was true (that the business was not really dying) so I am really glad that you printed this. Thanks!

  2. The retail sales number may not be high enough as many stores don’t sonudscan and we have a huge issue of promotional units be sold at full price. Other then that i applaud Bruce’s reporting has he seems to be honing in on the real entertainment bottom line.

  3. It’s brilliant to see the share of the radio in the business.
    We’re all enthusiastic about the many music sites but forget about the potential of such “offline” platforms.

  4. I beg to differ vis-a-vis this article. Leaving aside retail recorded music sales for a moment, the other categories mentioned have ALWAYS been around and always been stable, but never ‘lumped in’ with the recorded music sales, and as in this case purely to support the author’s contention that the music business is as viable as ever. It’s not. The core business, that is, recorded music, both in units AND profit margin (the 19.99 price point now history, replaced by initiatives such as Amazon’s 99 cent sale on Lady Gaga) has been steadily and precipitously declining for years now, and as Michael McGuire, an analyst at Gartner, recently revealed, ““As the digital side grows, you get a different business model, with more revenue streams, but do we get back to where the revenue that the labels see is going to be fully replacing the CD in the next four to five years? No.” Two reasons I can offer. 1. The core demographic hasn’t changed much, still the 14-25 y.o. male, although female music consumption has risen marginally. This consumer wants 30,000 songs on a IPod, not a paltry 12 songs on a fixed disc that he has to lug around with 30 others, and he ain’t gonna shell out 99 cents a pop for this 80 gig ‘portable library.” And 2. The mp3 – or whatever digital delivery method might complement or replace it – has an endless life span, capable of being traded and exponentially proliferated an endless number of times, as opposed to the, if I remember correctly from my music biz days, the 3 or 4 times a CD/vinyl record is recycled.
    In a nutshell, this is a ‘puff piece’, calculated to mislead and justify the author’s ‘rah rah’ contention. Although business models yet to be imagined and exploited may lead to a renaissance, the real numbers don’t lie, are pointedly reflected in the demise of virtually all retail formats selling music and video on hard disc (eg. HMV’s recent fire sale and Blockbuster’s recent exit) and speak mightily to the salient facts this author chooses to ignore.

  5. We’er now 15 going on 16 straight weeks of increased album sales. Narm.com
    Manufacturing plants are all busy with Blu-ray & Vinyl plants running flat out some even 7 days a week which I personally know to be true as we’re P&D’ing a number of Vinyl projects and time lines are 6 weeks at best.
    These are facts that support the author and all of us in industry know that this is the best we’ve seen since 1995. Btw I take it your completely unaware that digital music last year 09 was down and this is a broad trend that first showed up in declining japanese numbers in 08
    As for what the consumer will buy. We know they WANT new music so it’s up to the indies to once again seek to have their music distributed by a wholesaler and for them make more music. The fans never asked to get music one way nor did the artist say let’s stop making records.
    It was the digitaltard and major multinational entertainment corporations that have been the force and resolve behind this issue. We need to get back to USmadeMusic.us exports and buy indie support locals on the home front.

  6. Exactly right. Songwriters, artists, musicians, engineers, publishers et al have been vanishing like endangered species. There are almost no record stores and 1 in 30 downloads is even paid for. I averaged 1.3 million record sales annually for 20 years on the songs I wrote. Then around 2001 the collapse began. People stopped paying for the extremely rare and difficult work I did for their enjoyment.
    I don’t write songs anymore because I have been robbed blind by the idiot consumer AND the record labels for the last decade or more. The biggest royalty payments these days are from class action lawsuits on behalf of publishers retrieving penalties on unpaid royalties from record labels. Not the actual royalties, just penalties from a pro-rated settlement – pennies on the dollar.
    The music business is gone, and it ain’t coming back. A rah rah puff piece of statistical manipulation, indeed.

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