Australia’s record business is on the upswing. Fueled by a surging streaming music sector, the recorded music market enjoyed a 5.5% bump in revenue to A$352.2 million ($269 million) in 2016, according to wholesale trade figures published Wednesday by ARIA. It’s the second successive year of growth in this top 10 market, which reported gains of 5% in 2015.
Digital is now the Australia’s powerhouse, generating some 70% of all sales, with streaming accounting for more than half that sum. The once-dominant CD albums market, meanwhile, continues its long march toward irrelevance.
Streaming was again the hero. Revenue from streaming products (a category which counts income from subscription services, ad-supported models and video streaming) grew by more than 90% year-on-year for a sum of A$135 million ($105 million) in 2016, equal to 38.5% of the recorded music market’s total value.
With streaming now the dominant format and on the rise, the digital market (including downloads) reached A$244 million ($186 million), a 17.6% gain on the previous 12-month period. Digital sales now account for approximately 70% of the total market.
CD albums are far from a dead format as far as Australian consumers are concerned. Revenue from CDs plummeted 21% to A$87 million ($66 million), though the format still accounts for about 25% of the total market. As CDs fall out of favor, the market for all physical product dipped 14% to A$107.9 million ($82 million) in 2016, a figure which still represents about 30% of the total recorded music business.
Though a niche format, vinyl continues to play a positive tune. Vinyl sales grew by 70% to more than A$15 million ($11 million in value, for the sixth consecutive year of gains, ARIA reports in its trade figures.
The industry is “delighted to achieve continuing growth in 2016 building on the positive results from the previous year. This is a reflection of the industry’s innovative marketing and high level of artist development, as well as the further consumer take up of quality digital retail services,” comments ARIA chairman Denis Handlin in a statement.
It makes for a promising set of figures but the hard work doesn’t stop there, insists Sony Music Australia’s veteran leader.
After a years-long lobbying effort, the industry enjoyed a victory last week when the Turnbull government dumped its controversial safe harbor provisions from the proposed Copyright Amendment (Disability Access and Other Measures) Bill 2015.
The industry is “now on a pathway to recovery,” notes Handlin, but it is “absolutely critical that Australia retains a strong copyright framework to ensure that artists and labels can continue to invest, innovate and protect their work and earn their fair share in the growing digital market.”
ARIA CEO Dan Rosen pointed to the “innovative nature” of the music biz and the flourishing homegrown artist community, with Sia, Violent Soho, Keith Urban, Flume and The Temper Trap among the record-breaking 20 Aussie artists to secure a No. 1 on the national sales chart during the year.
“It is truly exciting times for our local industry,” he explains, “with 2017 already seeing four Australian acts already having No. 1 albums, multiple ARIA award winner Flume winning a Grammy, and a growing number of our local artists having success on the international stage.”