RIAA on Twitter

Music Notes Blog

RSS Feed
Music Notes

Perspective, pings and other things relevant to our world

Can One Number Tell The Whole Story? - Part 2

December 28, 2012

As we end 2012, many music business observers will no doubt begin to reflect and report on the state of the industry.  It’s an appropriate time for reflection, partly prompted no doubt by the expected release of The Nielsen Company’s year-end summary of domestic music sales.  Barring any major last minute shifts, overall sales volumes for 2012 will likely be down in the low single digits on a percentage basis (including “Track Equivalent Album” sales).  Like many interested in the space, we’re eager to see this data.  But nearing the end of the year, it’s a good time to think about what this information means for the industry.  As we have argued in the past (here), the music industry has evolved in the last few years in ways that make some other numbers nearly (if not equally) as important in understanding the U.S. music market.

In 2011, Nielsen reported overall U.S. album sales (including TEA) of 458 million units.  But because of the nature of “sales” measurement, there are some very significant ways in which consumers are accessing and purchasing music that are not reflected.  This includes through subscription services like Rhapsody and Spotify, streaming services like Pandora, iHeartRadio, and thousands of online radio stations, mobile purchases like ringtones and ringbacks, and on-demand services like Youtube and Vevo.  Based on total dollars, subscription, mobile, and digital performance royalties accounted for more than $800 million of the $7 billion US music market (here).  That’s 12% of the market, and that contribution is likely to continue rising as those services continued growing in users and listener hours in 2012.  In fact, Spotify and Pandora have already announced large subscriber increases, and SoundExchange already distributed more digital performance royalties through the first three quarters of 2012 ($327 million, see here) than it did in all of 2011.  All this collectively demonstrates an industry that has diversified how it does business and offers fans music in a staggering array of models and services.  It’s worth noting, that’s exactly one of these reasons why we and NARM (the music retailers) created www.whymusicmatters.com, a one-stop shopping website offering a detailed guide to the more than 50 digital music services.

We are busy collecting the data (sales, shipments and licensing revenues) for 2012 and do not have final numbers yet.  Nonetheless, we believe that the diversification of music business revenues is an important element of any informed, comprehensive analysis of the state of the music business. 

Joshua P. Friedlander
Vice President, Strategic Data Analysis, RIAA


Streaming Music and Investment

December 20, 2012

Venture capital investment in digital music services – even streaming services – continues at a feverish pace.  A surprise to some?  Maybe, but some recent data points and news stories help validate this notion.  USA Today wrote about the most popular YouTube videos of the year (here), and once again the majority of the videos highlighted were professionally made music videos or music themed user generated content.  Interestingly, the list of all-time most viewed videos on YouTube continues to be dominated by musical content.  At last check, all but 3 of the top 30 videos were music videos - and that’s not even counting “The Gummy Bear Song” (here).  And we’ve written before about music’s popularity on other social media (here), including, for example, how musicians are so well represented among the most followed people on Twitter (seven of the top ten Twitter accounts currently belong to musicians).

Why does this matter? 

Because we believe that this helps explain what we saw in a second piece of news (here) – that venture capital investment in the music arena shot past half a billion dollars in 2012.  This shows that investors believe music occupies a unique space as a driver of digital media, and that it is poised to continue growing.  Total VC investments in music industry startups so far this year totaled about $620 million, up 34% versus the prior year.  Reports show (here, here, here, here) that the funding is coming not just from finance powerhouses including Sequoia Capital and Goldman Sachs, but media focused companies like Google Ventures, Amazon, and Access Industries.  We also dug a little deeper, and found that services that specialize in streaming music (such as SoundCloud, Deezer, Spotify, Songza, and TuneIn) accounted for more than $300 million of the total. 

So, for good reason, music continues to be a big draw. And not just for fans, but, for entrepreneurs and venture capitalists alike, looking no doubt to earn a return on their investment. 

Joshua P. Friedlander
Vice President, Strategic Data Analysis, RIAA


The Right Decision: A Treaty Spurned

December 14, 2012

RIAA supports the U.S. and other governments’ decisions to withdraw their support for a possible treaty at the ITU that would likely complicate issues related to Internet governance. We fully understand and support the desire of all nations to adopt sensible policies with regard to the Internet—both in terms of ensuring that Internet activities observe the rule of law, and in expanding broadband penetration to facilitate access and end the digital divide. We do not, however, believe that the ITU is best situated to achieve these laudable goals. Given the speed of technological development in this arena, we believe that questions related to the technical functioning of the Internet—i.e. Internet governance, are best left to an inclusive multi-stakeholder process that can quickly respond to challenges in Internet time. Vesting authority in the ITU, however, is not the solution, particularly given the overt interest of some countries to regulate the Internet in order to censor political speech or to otherwise limit the legitimate expression of views.

Neil Turkewitz
EVP, International


La Gran Senora

December 10, 2012

We at the RIAA can only react with the same shock and sadness as that of legions of fans and admirers throughout the world at the passing of the singular artist, beloved figure, formidable businesswoman, and force of nature that was Jenni Rivera.

Jenni blazed a path in every possible way.  Born into a realm of music -- regional Mexican -- often dominated by men, she became “La Diva de la Banda” by keeping the format but utterly transforming it with her voice, her candor, and her style.   There is no doubt that she ruled the charts and sales figures, with multi-Platinum certifications for albums such as “Parrandera, Rebelde y Atrevida,” “Mi Vida Loca” and “La Gran Señora.”  As relevant and compelling as ever, with “Joyas Prestadas: Banda” and “Joyas Prestadas: Pop” on the charts, the numbers tell only a tiny part of the story.

It was Jenni’s spirit, presence, boldness, passion for life, and “real-ness” that radiated in her life and in her music. It resonated beyond measure.  Her devotion to her fans was epic too, playing hours past schedule so that every fan would be satisfied.

I can only speak to her singular presence having had the incredible honor (and fun) of accompanying her when the California Latino Caucus recognized her with the prestigious Spirit Award on the floor of the State Capitol last May 2011.  Others were honored; major stars of film, television, civil rights and academia.  Yet, the fans, legislators – and the cameras! – singularly found her, everyone wanting to chat and come close. The room was mesmerized by her warmth, energy, candor and optimism, particularly in describing the formation of her foundation to aid battered women.  She was unabashed, unbowed and utterly inspirational. (That same summer, she would become the first regional Mexican artist to headline – and sell out – the Staples Center.)

Of course, her music and charitable work also only tell part of the story, as she was also a brilliant and inspirational businesswoman, making her mark across, tv, radio, film, production, fashion and fragrance.

It’s impossible to put into words the loss, or to think on what would have continued to be with this young, radiant figure.  We can only express our deepest condolences to her entire family and to her fans, as well as to the families of the other passengers lost on the plane.

As post after post of fans on her Twitter account said, prior to this and throughout her career, we can only add our own, “Gracias, Diva.”

Joel Flatow
GM, West Coast Operations/
SVP, Artist & Industry Relations