The United States' streaming revenue grew $369.7 million last year. Finland's streaming revenue grew only $5.9 million. Which country can boast of the better performance? Not the United States.
Finland had the biggest streaming gains of the nine countries whose 2014 recorded music revenue numbers have been released by the their trade organizations. (The IFPI's annual Recording Industry in Numbers report, containing revenue figures for countries worldwide, has not yet been released.) While $5.9 million is certainly smaller than $369.7 million, $5.9 million represents a larger percentage of Finland's gross domestic product (GDP) than that $369.7 million represents of the United States' GDP. (Billboard converted RIAA numbers for 2014, some of which represent consumer spending, into trade value of United States streaming revenue.)
Incorporating a country's GDP -- a country's private and public spending -- into the analysis allows for an apples-to-apples comparison between countries of widely varying sizes. As a result, a small country's smaller total streaming revenue can exceed, in relative terms, a large country's large amount of streaming revenue.
Which countries' streaming revenue grew the most in 2014? Finland and the United States ranked first and second respectively, in streaming revenue growth as a percentage of GDP. Sweden, a world leader in streaming penetration, and Japan, a streaming laggard, ranked just behind the United States at third and fourth, respectively. Norway was close behind at fifth. Australia, France, Italy and Spain were far behind.
Numbers can be deceiving. Japan, which had little streaming revenue at the end of 2013, posted an impressive 188-percent streaming revenue growth last year. But when GDP was taken into account, Japan ranked just fourth. Similarly, Australia posted a 111-percent gain in streaming revenue but ranked only No. 6. Spain's revenue growth was a respectable 12 percent, but as a percentage of GDP its growth was just the lowest of the nine countries. When indexed to Finland, Spain scored 8.7 (meaning its revenue growth was 8.7 percent of Finland's growth).
Another way to rank countries is by their total streaming revenue relative to GDP. Here Sweden ranks first by a wide margin. Norway and Finland are a distant second and third, respectively. It's no surprise the Nordic countries have the top three positions. Their streaming markets are the most developed in the world. The United States, where many artists and labels are displeased with streaming royalties and the growth of subscription services, ranks fourth. This is no doubt a testament to the country's well-developed market for non-interactive webcasting services such as Pandora.
Sweden's dominance in streaming revenue is better appreciated when the countries are indexed by revenue. If Sweden is 100, the United States is 43.1, meaning its revenue is 43.1% of Sweden's revenue relative to the countries' GDP. Japan, whose $43.1 million of streaming revenue was second only to the United States, scores a 6.4 because its recorded music market is dominated by CD sales and, to a lesser extent, digital downloads.
Comparing streaming revenue to GDP reveals clearly the less developed markets. Australia and Italy fare especially poorly here while France, the home of subscription service Deezer, appears to have much room to grow.
Streaming revenue gain as a percent of GDP (Country, % of GDP, Indexed to Finland):
1. Finland, 0.00003%, 100
2. United States, 0.0000212%, 70.9
3. Sweden, 0.0000212%, 70.6
4. Japan, 0.0000209%, 69.7
5. Norway, 0.0000184%, 61.3
6. Australia, 0.0000118%, 39.5
7. France, 0.0000095%, 31.6
8. Italy, 0.0000079%, 26.3
9. Spain, 0.0000027%, 8.7
Streaming revenue as a percent of GDP (Country, % of GDP, Indexed to Sweden):
1. Sweden, 0.000217%, 100
2. Norway, 0.000149%, 68.9
3. Finland, 0.000109%, 50.1
4. United States, 0.000093%, 43.1
5. Spain, 0.000041%, 18.9
6. France, 0.000037%, 17.2
7. Australia, 0.000023%, 10.4
8. Italy, 0.000017%, 8.0
9. Japan, 0.000014%, 6.4