HITS Daily Double

Income earned by British record labels from the sale of recorded music grew 10.6% last year to £839.4m, a return to 2010 levels according to trade body BPI. Last year’s rise was driven by streaming subscriptions and a continued vinyl revival, as well as a number of homegrown success stories.

The number is published within the BPI’s annual All About The Music report. It delves deeper into the £1.108b figure reported by the Entertainment Retailer’s Association in January by defining how much of that went into record label coffers.

The 10.6% rise is the fastest rate of growth since the height of Britpop in ’95. Total income, however, remains nearly one third lower than the British industry's peak year in 2001 when income topped £1.2b.

Revenues earned from streaming grew 41% in 2017 with the format now counting for 46% of industry turnover. Of the total £388.9m earned from streaming, subscription makes up 89% (growing 45% to £346.9m) while ad-supported (£14.8m) and video (£27.1m) rep the rest at £42m—a rise of 15% and 16% respectively. Downloads, meanwhile, were down 26.5% to £112.9m.

Physical also rose by 2.4% to generate £310.4m worth of income, with CDs counting for a 29.4% overall marketshare while vinyl rose 24% to make up 6.6%.

Geoff Taylor, Chief Executive of the BPI & BRIT Awards, praised the labels for their continued investment in talent and adaptation to the ever-evolving digital age.

“The changes labels have made to their business models and their investment in new talent have borne fruit with rapid revenue growth in 2017,” he said.

“We are likely to see a continuing rise in 2018, with increasing awareness among consumers about the benefits of music streaming, and new developments that are likely to encourage the uptake of subscriptions, such as the launch of YouTube’s premium music service and the growing popularity of smart speakers in the home.”

For music to recover fully and achieve long-term sustainable growth, however, Taylor calls for government action to fix the ‘Value Gap’ “so that all digital platforms pay fairly for their use of music."

"With the transition period following Brexit now agreed, it is vital that British musicians can tour freely in the EU once we leave. In addition we urge Government to seize the opportunity of its Digital Charter to forge an online environment that is safe for consumers, where illegal sites cannot flourish, and to look at new incentives for investment so that the U.K. is the best place in the world to invest in creating music. These measures are essential given the increasing competition the U.K. faces in a more global streaming market.”