As a consequence, physical sales fell by just over 5 percent to $5.2 billion, accounting for 30 percent of the global market. Download revenues slipped by 21 percent to $1.8 billion, while overall digital sales were up 19 percent on 2016, totaling $9.4 billion. In 32 markets, digital revenues now account for more than half of all music sales, said IFPI.
Breaking this year's figures down regionally, sales in North America rose by 13 percent in 2017, with streaming income rising by 50 percent year-on-year. Europe was up 4 percent on 2016, when revenues rose by 9 percent, with its biggest markets, Germany, U.K. and France, all experiencing growth in streaming revenues.
As per previous years, Latin America remained the region with the highest level of growth, recording an 18 percent rise, driven by a 49 percent increase in streaming revenues. The music market in Asia and Australasia climbed by over 5 percent, its third year of consecutive growth.
Across all markets, performance rights revenue grew by just over 2 percent to $2.4 billion – accounting for 14 percent of the total market. The global sync market also grew, climbing nearly 10 percent and maintaining its two percent share of all recorded-music revenues.
In terms of the world's biggest music markets, there's no change with the U.S. still at number one, followed by Japan, Germany and the U.K. Significantly, China broke into IFPI's top ten global rankings for the first time, nudging in at number ten.
Speaking at the report's launch, IFPI chief executive Frances Moore said, "the industry is continuing on its path to recovery," but cautioned that "the race is far from won."
"The growth that we have seen over the past three years of consecutive growth has really been driven by this industry and their investment in artists and investment in innovation and constantly striving to make the music experience better," said Moore.
"But as much as the industry can do a lot - and has done a lot on its own - there is a structural fault in the system," she went on to say drawing a stark comparison between the $5.6 billion that record companies earned from paid and ad-supported music streaming services in 2017 and the $856 million generated by video platforms like YouTube, who have a user base almost five times as big.
"Until we fix that structural defect to the market it will always be a struggle," she stated, noting that, despite strong growth around the world, global music sales still remained only 68 percent, or around two thirds, of the market's peak in 1999.
Joining Moore at the report launch, held at Dolby Europe's London office, were Stu Bergen, CEO, international and global commercial services, Warner Music Group; Dennis Kooker, president, global digital business and U.S. sales, Sony Music; and Adam Granite, executive vice president, market development, Universal Music Group.
"We're obviously pleased that the recorded music industry has grown for a third year, but we're not getting complacent," said Bergen. "We've fought too hard to get here and, after 15 years of decline, there's still plenty of room to grow."
Citing the success of Warner-signed Brazilian singer Anitta, Bergan said that thanks to streaming, "the next global superstar could just as easily come from São Paolo as Suffolk" and spoke about the potential of voice-controlled devices and recent license agreements with social media giants like Facebook with enabling new opportunities to reach audiences.
"As record labels, it's our job to match the creativity, versatility and ambition of our artists, with campaigns that have immediate and lasting impact, both on a global and a local level," he stated.
Those views were echoed by Sony Music's Dennis Kooker, who called "paid streaming the fuel to the industry's growth."
"Record companies have evolved in response to the incredibly transformative developments that have forever changed how consumers listen to music," he continued.
"We have adapted and innovated in a digital marketplace – creating new roles, developing our data and analytic platforms, enhancing our playlisting capabilities, licensing our artists' music to more partners than ever before and engaging in new and exciting ventures with start-ups. As an industry that continues to change at a rapid pace, record companies must ensure we sustain this culture of change in order to continue on a path to growth and remain relevant to fans and artists," said Kooker.
"Through technology music is transcending borders, including geographic borders like never before," added Universal Music's Granite, who said that building sustainable success required music companies remaining "focused on artists and artist development, but that we also continue to drive innovation in constructive way, in a public policy environment that enables fair compensation for creators."
Pointing to fast-growing emerging markets like China, Africa, India and the Middle East, Granite went to say that "the path to reaching these 4 billion people is now illuminated by smart phone penetration and global streaming services."
"As an industry, we must remain focused on maintaining a sustainable eco-system for these emerging and high potential markets. This begins with strong copyright laws to protect music creators, then fair remuneration for artists across all uses of their music, and finally investment in local repertoire," he stated. "All of these pieces must work together and, when they do, you have a healthy creative environment that allows artists to thrive and their audiences around the world to find them."