The UK has become a generation of renters, as a report from the Entertainment Retailers Association (ERA) reveals that revenues from music streaming services has surpassed downloads and physical formats such as CDs and vinyl.
The rise of music streaming services shows no signs of abating in the UK. Revenues rose by 38% to £829m in 2018, as paid-for subscriptions accounted for 62% of all music revenues, while downloads, CDs and vinyl took up the rest (38%).
The increase is down to music streaming sites such as Spotify, Deezer and YouTube converting users from the free tier to paid-for subscriptions. Amazon introduced more customers to its streaming offering, in part thanks to its success with the Amazon Echo smart speaker.
Music follows games, videos and video-on-demand services in making the move to digital, continuing a trend that’s seen consumers less interested in purchasing entertainment outright than in paying access for it. That’s contributed to UK consumers paying £4.5bn annually on access to music, video and games.
ERA CEO Kim Bayley said, “This is a significant moment. For the first time since the birth of the modern entertainment business in the late 1950s, more revenue is coming from payments for access rather than purchase in all three sectors – music, video and games. New digital services have created a “Generation Rent” for whom access models seem natural. It is nothing less than a revolution in the entertainment business.”
Other facts and figures show that the UK’s entertainment revenues grew for a sixth consecutive year to an all-time high of £7,536.8m, up 4.4% from 2017. Digital accounted for 76.1% of that total, a marked increase from the 20% market share it held in 2011.
If you’re a fan of physical formats then don’t despair (at least not yet). They’re still alive, if kicking less frequently, with £765m spent on video games (a decline of 2.8% year-on-year). The vinyl record market grew by 4.4% to 4.3m sales, marking ten years of consecutive growth from its low in 2008 where it managed to shift just 220,000.
Elsewhere DVD just won’t quit as it grossed more than Blu-ray (£466.9 to £130.4). New format 4K Blu-ray brought in £19.6m.
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