LONDON – Vinyl sales grew twice as fast as streaming in the United Kingdom last year, helping drive an 8.7% rise in overall music spending, according to year-end figures from the Entertainment Retailers Association (ERA).
Vinyl album sales rose by 23% to £136 million ($184 million) in 2021, compared to 10.9% growth in subscription streaming revenue over the same period. Overall music spending rose to £1.68 billion ($2.3 billion), the organization says in its preliminary annual figures published on Wednesday (Jan. 5).
While vinyl sales outpaced streaming, digital music services like Spotify, Amazon Music, YouTube Music and Apple Music account for almost 80% of recorded music spending in the U.K., with subscription revenues climbing to a record high of £1.3 billion ($1.8 billion), up 10.9% from 2020.
ERA estimates that streaming subscriptions would have delivered around £900 million ($1.2 billion) to record companies and publishers in 2021, based on the current business model whereby streaming services pay out around 70% of subscription revenues to labels and rights holders.
In its year-end listening figures, released earlier this week, labels trade body BPI reports that a record 147 billion tracks were streamed in the U.K. last year, up 5.7% on 2020, and the equivalent of 159 million albums were purchased across all formats, an increase of 2.5% on last year’s total. Meanwhile, nearly 2,000 artists were streamed more than 10 million times in the U.K., a 25% jump in the number of artists streamed at that level two years ago (180 artists achieved more than 100 million streams).
In the U.S. vinyl sales also outpaced streaming growth in the first half of 2021, according to MRC Data. While on-demand streams grew by 10.8% to 555.3 billion, vinyl unit sales more than doubled between January and June to 19.2 million.
Although both the ERA and BPI use Official Charts Company sales data as the basis for their reporting, the two organizations take different approaches to measuring the health of the recorded music business. ERA’s figures are based on retail spending in the U.K., whereas BPI’s measure music consumption levels. (ERA’s streaming numbers are estimates based on information provided by digital services and label trade income reported to BPI). BPI and ERA are both due to publish their full annual reports later in the year.
Key takeaways from ERA’s analysis of the British recorded music market:
- Total music sales hit £1.68 billion ($2.3 billion), up 8.7% on 2020.
- Subscription streaming revenues rose 10.9% to £1.3 billion ($1.8 billion).
- Vinyl sales climbed 23% to £136 million ($184 million), offsetting a fall in CD sales and helping physical format revenues grow 7.3%, their first increase since 2001.
- CD sales fell 3.9% to £150 million ($203 million).
- Album downloads dropped 23%, and now generate £33 million ($33 million).
- Revenues from cassette sales grew by 26% year-on-year to £1.5 million ($2 million), but the niche format still represents a miniscule fraction of the overall market (less than 0.5%).
BPI reports that streaming now accounts for 83% of U.K. music consumption, with physical formats representing 12.5%. Breaking down physical format sales, 14 million CDs were sold in the U.K. last year, down 11% from 2020, with 5.3 million vinyl LPs purchased, a rise of 11% year-on-year. And 185,000 cassettes were sold, up 19% and the highest number since 2003.
Best-selling titles across all formats included = by Ed Sheeran and Voyage by ABBA, while Adele’s 30 was the year’s biggest selling album in the U.K. Also making the top 10 were releases by Olivia Rodrigo, Queen, Dua Lipa, Elton John and Fleetwood Mac.
The year-on-year growth of the U.K. music business is welcome news to label bosses and execs following a turbulent 12 months that saw large numbers of artists, including stars like Paul McCartney and The Rolling Stones, criticize the streaming business for making low payments to musicians and creators.
Last year also saw the conclusion of a nine-month Parliamentary probe into the streaming model, which found that the business was “unsustainable” in its current form. The United Kingdom’s competition enforcer, The Competition and Markets Authority, is currently conducting a market study of the U.K. record business, looking at the dominant market share of the major labels, Universal Music Group, Sony Music Entertainment and Warner Music Group.
“Success today is gauged in the multi-millions, sometimes billions of streams, which generate micropayments that build over time,” says BPI chief executive Geoff Taylor. “This year’s growth shows there is a huge appetite for music, and we believe that by working together we can increase the value of the whole music market, so that streaming can support even more artists in the future.”