The Internet Radio Boom
The internet radio wars have been going on for years. Some players are still at the top, some have folded, and new ones seems to be joining the fold every year. Our data from Knotch shows that most users both use and are in favour of internet radio.
Over the next couple of weeks we’ll be looking into the different services and comparing their numbers with the sentiment data collected on Knotch. However, before we dive into that here’s a primer on the numbers over the last few years to help you understand just how big of an industry internet radio has become.
According to a study done by Edison Research and Triton Digital earlier in 2014 over half of the U.S. under 50 listens to online radio every month, with 66% of people ages 18-34 tuning in. Streaming music services are continuing to grow. Last year, streaming music revenue grew 39% in the U.S. The Recording Industry Association of America (RIAA) and it’s overall share in the industry has steadily climbed over the last 5 years.
Both vinyl and CD sales continue to fall as they dropped another 12.3% last year, but so did downloads, dropping 1%. This is starting to show the shift in ownership period as more and more people are moving towards on-demand services like Spotify in lieu of owning the actual music. The RIAA estimated that on-demand subscriptions nearly doubled from 2012-13 from 3.4 million to 6.1.
Streaming services counts for over $1.4 billion in revenue in 2013. $590.4 million in royalties was paid out from various services like Pandora to artists, songwriters, and rightsholders last year up 27.8%. $220 million came from ads on free services such as YouTube, Pandora, and Spotify, which was 28.7% increase. Lastly, the biggest amount was the $628.1 million came from subscriptions such as Spotify Premium or Pandora One. This was where the gigantic increase happened. Subscription revenue skyrocketed 57% from 2012.
The space is still growing and over the next few weeks we’ll take a look at how some of the biggest in the space are fairing in comparison to one another.