May 24, 2016

The BPI, the record labels’ association which promotes British music, has published its Music Market 2016 yearbook, an 88-page guide to the UK recorded music industry in numbers, with full analysis and detailed commentary on market trends based on Official Charts, IFPI, Kantar Worldpanel and other data.

The book highlights the achievements of British artists in 2015, whose share of domestic album sales reached an 18-year high (at 54.7%) and saw them make up seven of the top ten annual best sellers in the Official Charts.  British music’s exports to key markets around the world also grew, as UK acts, led by the extraordinary success of Adele’s 25, claimed an impressive 17.1% share of the global albums market, equivalent to around one in every six artist albums sold worldwide, and most likely the highest on record.

However, while music consumption based on Album Equivalent Sales (AES) rose by 3.7% at home (a figure which increases to 12.9% if you include streaming of music videos), total industry revenues, including performance rights, grew by only 0.6% in 2015, with income from sales and streaming of recorded music, including the share that can be passed on to artists, dipping by 0.9% to £688 million.  The BPI says that the disparity between consumption and revenues is explained by pure ad-supported platforms, in which YouTube is the dominant player, contributing only 4% (£24.4 million) to this total, despite increasing by 88% year-on-year to represent nearly a fifth of total music consumption.

This stands in stark contrast to the £146.1 million that audio streaming services (such as Spotify and Deezer), contributed to artists and labels from a similar number of streams.  Audio streams increased by 82% in 2015, leading to a 69% rise in revenues.  The £24.4 million generated by pure ad-supported streaming, principally music videos streamed on YouTube, was smaller even than the £25.1 million earned by labels from the sale of vinyl LPs in 2015, which format represents less than 2% of overall UK music consumption.  The BPI says that this illustrates that the much-debated music industry “value gap” or “value grab” (caused by UGC platforms relying on copyright loophole “safe harbours” in EU legislation to pay much lower royalties than competing services) is growing.  To read the BPI’s press release in full, click here.