UK recorded music revenues up 12.8% in 2021 reaching £1.262 Bn according to a recent report by the BPI. This marked the sector’s seventh consecutive year of revenue growth, led by streaming. However, when adjusted for inflation, revenue in 2021 was £368 million below the 2006 CPI-adjusted figure of £1.63 Bn, while using RPI the 2006 figure would have been £1.795 Bn – £534 million higher than the 2021 total.
Revenue from streaming again fuelled much of the rise, up 13.7% to £837.2 million, with physical formats on CD and vinyl growing at a faster rate, also contributing – up by 14.6% to £241 million. These figures coincided with an increase in the number of indie record shops, recently reported by the Entertainment Retailers Association (ERA), which grew went from 390 in 2020 to 407 in 2021.
The increase in streaming revenue was shaped largely by paid subscriptions to streaming services (such as Spotify, Apple, Amazon and Deezer). This rose by 13% to £734.5 million. Ad-funded streaming income grew by 15.7% to £49.1 million. Income from video streaming platforms, notably YouTube, showed some growth, up by over a fifth (22.6%) to £53.7 million but is still well under half the amount generated by vinyl. Revenue from digital downloads continues to decline as substitution accelerates towards streaming. It fell by 23.3% in 2021, with downloaded tracks and albums generating just £33.4 million for labels.
While vinyl continues its amazing revival story, up 34% on the year, the gold star arguably goes to Compact Disc, which, off the back of superstar releases by ABBA, Adele, Dave and Ed Sheeran, contributed £117.2 million in revenue – a 1.4% rise on the year and the first increase since 2017. It means that CD still generates marginally more than vinyl for record labels and their artists, though this may change in 2022. Within the physical total, other formats such as cassette accounted for a fraction of the overall revenue total, but the format is keenly purchased by some collectors.
Sync (music used in film and other soundtracks and in advertising) has been an area of revenue growth for labels in recent years up until the pandemic in 2020. This has shown signs of a healthy recovery in 2021, yielding £30.8 million (47.6%). Income from performance rights from music played in public remains substantial at £117 million, up by 10.8% on the previous 12 months.
