The recorded music industry hit $17.1 billion in 2023 within the US alone. This is a huge growth compared with the following year, and it’s expected to continue rising.
In 2023, the recorded music industry in the United States boasted an impressive $17.1 billion in revenue. As reported by the Recording Industry Association of America (RIAA) in its 2023-Year End report released on the 26th March 2024.
This significant figure reflects an 8% year-over-year growth in retail revenue. Encompassing spending on streaming subscriptions, physical media, and digital music. Notably, this marks the eighth consecutive year of growth for the US.
Therefore, solidifying its position as the world’s largest recorded music market. Looking at the wholesale perspective, which indicates the money circulating back to record labels, distributors, and ultimately artists, the US recorded music industry saw major growth.
A huge $11 billion generated in 2023. Representing a 7% increase and setting a record high for wholesale revenues. Breaking down the RIAA’s findings. Retail revenues from paid subscription services like Spotify Premium and Apple Music saw a robust 9% growth.
Subscription streaming led to high revenue
Reaching $11.2 billion in 2023. These subscription services accounted for 78% of streaming revenues and nearly two-thirds of total revenues. The increase in subscription prices by leading platforms such as Spotify, Apple Music, and YouTube Music encouraged this.
Throughout, 2022 and 2023 the increases led to revenue surging. Despite the growth in paid subscriptions, revenues from limited-tier subscriptions, which include services with restricted access or features, experienced a 4% decline year-over-year, totalling $1 billion in 2023.
Total streaming revenues, including paid subscriptions, ad-supported services, digital and customised radio, social media platforms, and digital fitness apps, saw an 8% increase to $14.4 billion. Comprising 84% of total revenues for the second consecutive year.
Moreover, the average number of subscriptions per user rose by 5.7% to 96.8 million in 2023. Excluding limited-tier services and counting multi-user plans as a single subscription. The growth in subscriptions again has contributed to this overall increase.
Ad-supported revenue will continue to grow
Ad-supported revenues from platforms like YouTube and ad-supported Spotify saw a more moderate 2% growth. Totalling $1.9 billion, contributing 11% to total recorded music revenues in 2023. Without ads, music streaming platforms wouldn’t make the money.
In the physical music market, revenues reached $1.9 billion, which is up 11% from the previous year. With vinyl records accounting for a significant portion at $1.4 billion. This marks the 17th consecutive year of growth for the format.
Vinyl represented 71% of physical format revenues in 2023 and outsold CDs in units for the second time since 1987, with 43 million vinyl albums compared to 37 million CDs. Despite this, CD revenues also saw growth, rising by 11% to $537 million in 2023.
