Streaming Services Put Big Dent In Music Sales

Demand for music streaming services is surging as consumers turn away from purchasing albums or individual songs, Nielsen reports.

2017 marked the first year that on-demand audio accounted for the majority of music listening, according to news from TechCrunch.

Overall consumption of on-demand streaming of albums, songs and audio grew 12.5 percent year over year. A 59 percent increase in on-demand audio streams offset track and album sale declines.

Digital and physical album sales alone dropped 17.7 percent last year to 169.15 million copies from 205.5 million in 2016. In total, on-demand audio streams exceeded 400 billion in 2017, and overall on-demand services surpassed 618 billion, the blog reported.

For the first time ever, R&B/hip-hop became the most dominant genre, with seven of the top 10 most-consumed albums coming from that category. The popularity of R&B/hip-hop was powered by a 72 percent increase in on-demand audio streaming.

The growth in music streaming contributed to a 20.5 percent rise in total digital volume in 2017. Video and audio streaming grew 43 percent this past year.

Not as surprising, Nielsen found that audio streaming is more popular on weekdays. Video streaming takes the lead on the weekends.

But amid surging interest in digital streaming, vinyl had a renaissance in retail, experiencing sales growth for the twelfth consecutive year. The classic medium comprised 14 percent of all physical album sales.

The Nielsen report comes on the heels of news that popular music-streaming service Spotify will file for an initial public offering (IPO). And, last year, Apple announced that it was acquiring Shazam — a song recognition service — as it seeks to grow its music business, TechCrunch reported.

Renewing Spotify for many consumers is a forgone conclusion because the service continues to introduce new titles and artists. Spotify even invites artists to perform live in its Spotify Sessions that are streamed to subscribers.