Music Sales Continue to Plummet for Albums and Digital Downloads

Kristen Bell and Idina Menzel perform

Music sales continued their free-fall during the first six months of 2014, as both albums and digital downloads again showed double-digit losses.

According to Nielsen SoundScan data released Wednesday for the year to date through June 29, total album sales in all formats plunged nearly 15%, with sales of almost 121 million, versus 142 million sold in the first six months of 2013.

To put the steepness of the decline in perspective: Just 18 months ago, Adele’s Grammy-winning “21” — the bestselling album of 2011 and 2012 — finished the latter year with sales in excess of 10 million. It is conceivable that such a phenomenon will not be seen in the industry again.

Digital track sales dropped 13% to 593.6 million, in comparison to 682.2 million moved in the same period last year.

On-demand streaming continued to boom, soaring 42% to almost 70.3 million streams (compared to 49.5 million in the same period last year). However, revenues derived from streaming are a fraction of those derived from physical and digital album sales on a per-unit basis.

Once again, vinyl albums showed a potent gain, up more than 40% to 4 million units (compared to 2.9 million in the first half of 2013), though the format remains a sliver of the industry’s overall business. Jack White’s “Lazaretto,” which was issued in a special holographic LP edition, was the bestselling title at 49,000 units.

In a statement, Nielsen senior vp David Bakula said the lifts in streaming and LP sales “shows interest in buying and consuming music continues to be robust, with two very distinct segments of the industry expanding substantially.”

So far this year, the bestselling album title – and the only one to sell more than a million units – is Disney’s soundtrack for the hit animated picture “Frozen,” which has moved nearly 2.7 million units. Cumulatively, the late-2013 release has sold just over 3 million; it is situated at No. 5 on the top albums chart released Wednesday.

“Frozen” was succeeded among the year’s bestsellers by Beyonce’s self-titled collection (702,000), Eric Church’s “The Outsiders” (642,000), Lorde’s “Pure Heroine” (641,000), and Coldplay’s “Ghost Stories” (589,000). “Beyonce,” a surprise digital release in December, and Lorde’s title, the teen singer’s Grammy-nominated debut, were released in 2013.

Among digital songs, Pharrell Williams’ ubiquitous “Happy” — heard on the “Despicable Me 2” soundtrack” — was the top seller, moving 5.6 million for the year. It was followed by Katy Perry’s “Dark Horse” (4 million), John Legend’s “All of Me” (3.8 million), Jason Derulo’s “Talk Dirty” (3.6 million) and “Frozen” vocal star Idina Menzel’s soundtrack hit “Let It Go” (2.8 million).

Perry’s “Dark Horse” was the most-streamed song, with 188 million audio and video spins to its credit. It was succeeded by Legend’s “All of Me” (145 million), Derulo’s “Talk Dirty” (142 million), Williams’ “Happy” (135 million) and Menzel’s “Let It Go” (129 million).

“Happy” was the most-played song on terrestrial radio stations tracked by SoundScan’s Broadcast Data Systems unit, with 571,000 spins.

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  1. TH says:

    three million units to four million units is closer to a 33% increase, not a ” more than 40% ” increase …

  2. JohnQpublic says:

    Yes, it’s is caused by the disease of artificial music called rap or hippyhop or house, or whatever you call it. First of all, that noise is not “music” because those performers are not musicians. It’s simple, sales are down because the quality is crap. Bieber, Kanye West, and that Miley pig are topping the garbage charts and you want “sales”, from “hype”? Lol

    • Smooth. says:

      What you’re saying is crap, people buy rap music or any other music because they want to buy it. You want to eliminate their choices. You sound like one of the idiots that want to arrest the illegal immigrants, but not the illegal employers. Why don’t you quit complaining and make some of your so called real music. Anyone can be racist, hateful, and whine, that doesn’t take any talent either. Jealousy is a loser’s disease, see a doctor.

  3. Forrest Ross says:

    My friends that make good music are doing pretty well. Maybe the industry should take note. Shitty music sucks and nobody with taste likes it.

  4. jasonpmoran says:

    This seems like a very, very, very low estimate of streams unless I have misunderstood the article. Pharrell’s ‘Happy” alone has 328 million views on Youtube in the past 7 months. Where does that fall in this data?

  5. 2noame says:

    Here’s an idea to consider. People no longer have the money to spend on luxuries like music. Wages have been going down while costs of living have been going up. Meanwhile those at the top, as the only ones doing better than ever, don’t need millions of copies of a single CD. They only need one. They don’t need millions of copies of a single track. They only need one copy. And they don’t need millions of phones and tablets running millions of copies of streaming software. They only need a few.

    The rich cannot drive a consumer economy, but they can drive it into the ground.

    Consumptions of music is suffering for the same reason consumption of everything else is suffering. Inequality has reached too high of a degree, to the point it is damaging the economy. Consumers need enough money left after covering living expenses to consume the products and services they and everyone else are creating and that are also increasingly being created by machines. If people aren’t being paid enough to actually consume, the entire economy suffers.

    If the music industry and every other industry wants to see their numbers stop dropping and start climbing, they should support an unconditional basic income, so that everyone has their basics covered, and all income from work above and beyond this basic income could go towards driving the economy through the purchases of goods and services.

    • Bill says:

      Nonsense; people don’t have $.99 or $1.99 to download a music track when they gladly spend many times more that on apps and Candy Crush levels? Please.

      It’s more the usual: For the most part, anyone under 30 believes music is and should be free, and with Frozen many of those purchases were from parents or as gifts.

      One of the other factors in album sales is now that most songs are purchasable individually, there’s no need to buy an album to “hear the rest”; you can sample every track first to see if it’s worth the purchase.

      Music has, unfortunately, gone from an own the library concept to paying services like Pandora and Spotify a flat fee for them to aim the musical firehose at you while compensating artists fractions of pennies.

      People get their music, streaming companies are happy, artists have to tour to make anything.

      • Ellen Burns says:

        A track? Usually people like variety. I like thousands of songs, and I can’t spend that kind of money to switch my music collection to digital. And I really don’t want more CDs. So, I stream.

    • Just Saying says:

      I agree with the ever-growing income gap, but I disagree that the decline of physical music sales has too much to do with it.

      Technology and fashion probably have more to do with it. For example, vinyl sales are increasing, which arguably have better sound than digital equivalents. While a small subset of sales, I think folks like to collect things still and CD collecting has never been nearly as hip. The same goes with audio cassettes when that was a thing. (Anecdotally, I never really heard “cool kids” ever bragging about a large CD collection for the rise of the MP3–it’s always been a vinyl record collection.)

      The other major aspects are lowcost to free digital streaming options such as Pandora et al. Those that want to collect files may simply use free filesharing options. (The same can probably be said to a lessor extent about video and non-live-TV-watching cable cutters, i.e., not sports fans). There is software/sites available to rip AV from sites like youtube.com for more “advanced users”.

      Those that do actually want to download and buy files will use often use Apple iTunes.

      Finally, folks are simply spending more on monthly subscriptions such as broadband internet, Netflix, Hulu, music streaming services, and smartphone plans. So the money spent on that likely have an economic substitution effect on CD, DVD and Bluray sales. The plethora of set-top boxes like Amazon TV, Apple TV, Roku, and WDTV encourage the use of streaming services.

      Then pile on video game sales on consoles, tablets, and smartphones competing for entertainment dollars. The Xbox One and PS4 were just released, and Nintendo Wii U seems to be gaining some stream. Tablet and smartphone sales are “going gangbusters” esp with Android and iOS reaching closer feature parity these days. Moto G and E smartphones are good cheap devices; Android tablets have a wide variety of ultra lowcost to highend. None of these new mobile devices find CDs too useful, and people aren’t in the habit of ripping CDs as much (some folks don’t even use Apple iTunes and sync their devices anymore either).

      Just some thoughts…

  6. AGK says:

    Long live vinyl!

  7. Dennis says:

    And whose fault is it that revenues from streaming are plummeting? There used to be a few record discounters in brick and mortar stores as well as full price stores to choose from but if you control the product don’t you set the prices? record labels ahve caved to the distributors because they’re afraid their product won’t sell amid the glut of chep downloads.

  8. Y says:

    Why do people need to physically own things anymore? The choice between personally owning a selection of music or being able to stream almost everything for $10 per month is not much of a choice.

  9. Chris Jenson says:

    Did it ever occur to anyone in the pop and hip hop business that the music is just lifeless and boring?

    The passion, the energy, the excitement is now all in EDM.

    Time you wake up and stop complaining about the technology! That is not the problem.

    • Cameron says:

      Edm is just the new whitenoise for parties. People aren’t buying those cd’s unless they want physical evidence of their “hip” taste in music.

  10. Lazlo says:

    The fruits of the business described in Pink Floyd’s “Have a Cigar” are finally bearing fruit. With the availability of good music being produced independently on a local or regional level and directly marketed to it’s fan base for reasonable prices, fewer and fewer listeners are interested in buying ‘manufactured music’ anymore. The old models are crumbling and in my opinion it is about time. Quality is starting to replace glitz as the primary factor, and the rich kids with pedigree whose daddy buys them a market machine are being ignored.

    I have never understood why the singing of a song should make one wealthier than the guy with a plumbing business. The fall of the media moguls, and the desperate contortions they go through to preserve “the gravy train” have supplied me with hours of gleeful entertainment. It is becoming a more egalitarian world. Maybe these changes will result in a real merit system where the true talent rises and the wanna-be chaff is burned off.

  11. Truemore says:

    Music tastes change all the time. Heck in the last 100+ years music tastes have bounced all over the place and a dozen or more new styles of music were created. So I don’t thing quality of music is the issue.

    I do believe that the market has fragmented all over the place. Back 15 or more years ago there were central,”cool factories” like MTV this made it easier for an artist to produce a mega-hit. Now not so much because there is no central place, you have hundreds of smaller markets on radio, TV, internet, youtube, Itunes, etc. I also feel that with this infinite choice you get a lot of smaller acts that can get heard so I would say you have many more choices just not as many mega-hits.

    Next problem is demographics, there are a lot more people who are older, this is not a bad thing, but it does mean that don’t buy as much new music. The grey shift of the demographics means less people in the US buy music in any form.

    The final problem is technological, you don’t need to buy it because if you a casual listener there are a bunch of ways to get it for free and if your a hardcore listener you can also get it for free. So there really is no logical reason to buy it, other than your “breaking the law” and frankly that horse is out of the barn, no one cares they just do it. Heck if you look at studies of people under 25 most don’t consider illegal digital downloads theft, so you really lost the war there. Also even if you don’t download if a member of your social group does you can get the song in a fraction of second, via email, stick, phone etc.

    Overall I think performers are seeing the writing on the wall and understanding they will have to make money doing movie soundtracks, concerts, promotional stuff, merchandise, etc. I think Gene Simmons was ahead of his time with all the merchandising, but he is laughing all the way to the bank. :)

    • Lazlo says:

      You have a lot of great points, Truemore. And I think it really is just that performers should make the bulk of their money from performing. But even this has been tainted by the big business types who charge what the market can bear. When I was a kid you could see a big name band for the price of what you earned doing odd-jobs. Now, ticket prices for those groups exclude everyone but the wealthy, and I think you see a loss of interest because of it. It is going to be interesting to see how this all unfolds. I am hopeful and optimistic – especially if market forces are allowed to work unimpeded and a new paradigm is established in the music business world.

  12. It’s the music, not the delivery system. Most of it is soulless corporate schlock. Who would want to pay for that?

  13. dan says:

    Everything is free now. That’s all folks.

  14. Geoffrey Peart says:

    These feels like half a story, album sales and song sales are down, but how are music industry profits? Are the album sales being supplanted by subscription music services, and are the labels and artists seeing more/less/same money from license fees from subscription/non-subscription (ad funded) services? That second data point really differentiates this story.

  15. thecrud says:

    I find used cd’s for a buck all over the thrift world Hit them on sales days, swapmeets.

  16. Dennis Lear says:

    I love music but am old enough that I still buy mine on CD. I just read this via facebook with an artist ranting on about bit quality, compression etc etc and how it’s not there in downloads. The trouble is that the music industry has become so “inbred” it’s lost touch with reality. A 15 year old wants to hear her favourite artist on poor quality earphones vis youtube spotify or any other free streaming. Most wouldn’t know what bit quality was if it bit them! A few years on and they can afford a huge sub in the boot of their car and as long as the base threatens to break their back what do they care about quality. Truth is the i industry has been blind to the threat of free streaming for years and is only now reaping the rewards.

  17. Paul lane says:

    Funny how Led Zeppelin rerelease of their first 3 “albums” (43 years ?) are beating everything elese. And to think that Rolling Stone panned them on the first release. Ha ha.

  18. What do we do? says:

    Yeah I know it’s the magic question but as this behavior and market change comes to movies what in the world do we do to survive it? Are we going to become cogs in the Studio of Netflix et al? Are all movies either going to cost 100k or 100m? I want to make money in this industry and not get 5k producer fee for 5 months of work. Scary.

  19. John Smith says:

    In the day and age of nasty lyrics, twerking, …etc. What would you expect?
    I am actually surprised that people listen to this crap.

  20. cxg says:

    Don’t suppose it has anything to do with the quality of music being released? Haven’t heard anything lately I am willing to spend good money for.

    • jim says:

      You’re completely correct cxg. Stuff has become totally trite. It’s always been corporate, and it’s always been the case that most releases are mediocre, but there’s also always been innovative and interesting work in each era that could be discovered. This is still out there, but it’s coming from europe and other countries. Not the US and UK anymore.

    • kevin says:

      You just have to look a little harder. It can be hard to find good new music, but that’s another reason streaming apps like spotify are doing so well. They make it immensely easier to listen to new songs and artists without having to commit to a download or deal with youtube. The price is higher than other media streaming apps but I think it’s completely worth it especially with the size of their music library and the sound quality that they provide.

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