Sources: 27/7 WallStreet – By Paul Ausick | All Things Michael
Music demand is higher than ever. In the first six months of 2015, U.S. music fans streamed 135 billion songs and music videos, nearly double the total streamed in the first half of 2014.
The news is less good for sales. According to the latest report from Nielsen, song sales dropped 10.4% to 531.6 million and album sales dropped 4.0% to 116 million units.
None of the streams in the Nielsen study went to Apple Inc. and its new Apple Music service, so when the researchers produce their report for the second half of the year, we’ll get a pretty good idea of how successful Apple Music has been.
After the spat with Taylor Swift, Apple gets to stream her hit album “1989,” but that may not be a big bonus. Re/Code noted that songs from that album were streamed just 188,213 times in the first half of the year. The album sold just 1.33 million copies, and if you add album equivalent units from single sales, the album sold an equivalent of around 2 million units. The album needs to increase that by a factor of 10 to join the ranks of the 50 top-selling albums of all time. Then sales need to increase by another factor of five to reach the number one spot, now held by Michael Jackson’s “Thriller” from 1982.
Does anyone really think that “1989” will sell even 21 million records and join Madonna’s “Like a Virgin” from 1984 at 50th on the list? The point is not that Swift’s album is not musically as good as Jackson’s or Madonna’s, but that the business is different, and by 2045, “1989” is not likely to reach even 10 million in total sales. The days of huge album sales are behind us.
When Swift pulled her catalog from Spotify late last year, Nielsen commented that fans willing to purchase music missing from online services are more likely to buy just one or two songs rather than the entire album.
According to the Nielsen report, only Swift’s album sold more than a million actual copies in the first half of 2015. Only five other albums sold more than 1 million album-equivalent units, according to Billboard.
Apple’s iTunes gets a lot of the credit (or blame) for the demise of the album and the boom in singles sales, but can Apple Music translate the iTunes success into subscription revenue for the streaming service? When the Nielsen report for the second half of 2015 comes out we will know more.
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