Music Sales Decline As Listeners Switch to Streaming

Streaming is the talk of the music industry this year, with the number of song streams nearly double last year’s pace. It is not necessarily good news for the music industry, though, as streaming revenue is flat and the increase in streaming is not large enough to make up for the decline in sales. It is especially sales of individual songs that are declining, and the roughly 6 percent decline there is about equal to the 90 percent increase in streaming.

People are not just putting less money and time into recorded music. They are also paying less attention when they do listen to music. Streaming services now do a decent job of picking music for you, so that you can listen to music all day long without ever having to pay attention to it. After all, as long as the automated personal d.j. can pick music that is consistently tolerable, why bother learning the names of songs or recording artists? That is how some music fans seem to be reacting, anyway. As music gets pushed farther into the background, though, revenue inevitably seems to decline. One concern with inattentive streaming customers is that they may not actually be listening at all to the music they are streaming. How often are consumers turning the volume down to take a phone call, instead of turning the music off? With subscription plans, there is no incentive to do one over the other, but the result is that streaming services end up owing royalties on plays that haven’t been heard.

Ultimately, if music fans are not paying so much attention, paid subscriptions will give way to unpaid streams. An automated d.j. can still produce a tolerable music stream even when restricted to older recordings and unknown artists. How many music fans will really notice the difference? Making music a more automatic part of people’s lives will not produce a reliable income stream for musicians. Musicians and the music industry must continue to find ways to earn music fans’ attention.

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