Digital music sales in Italy hit 85% during the pandemic with streaming increasing from 60% to 80% of sales in the first half of the year according to FIMI, the Italian recorded music industry association. This unprecedented shift to digital music is the result of the lockdown in Italy and its effect on the Italian record market. Subscription revenues have also increased by 33% in the first half of the year.
The trend in Italy mirrors the latest quarterly financial results from Spotify which showed the increase of premium subscribers worldwide, with a 27% year on year increase reaching 138 million customers globally.
A recent report from Counterpoint Research, in the first quarter of 2020, showed that paid subscribers to all global streaming services grew by 25%, reaching a total of 394 million and with a higher growth rate compared to free subscriptions.
Predictions are difficult but FIMI estimate that the increase in streaming subscriptions could compensate for the collapse of concert revenues, physical sales and the sharp drop in music rights which usually account for 20% of Italian music industry revenue.
FIMI consider that the increase in digital music delivery has preserved the music industry from the declines seen in many industries such as book publishing which have suffered from changing business models with the rise of the internet.
As in other countries, Italian musicians have continued to make music even in the lockdown phase and have published their news on streaming platforms and social media which has proved popular with fans. The absence of a live music offering has also encouraged live streaming which, while not being able to become a substitute for a concert experience, has allowed artists to maintain contact with fans.
The recent announcement by Facebook to offer music videos puts the social media giant into direct competition with YouTube, the market leader in this area. FIMI thinks this will help to increase music video revenue which without Facebook’s initiative would likely have declined in 2020.
The prospects for the year are better than feared despite the pandemic mainly due to the increase of streaming and analysts still expect double-digit growth in 2020.
