Digital music revenues accounted for 55.5% of record industry revenues in the first quarter of the year. Digital income from all sources including à la carte, subscription and ad-supported services grew year on year by almost a quarter (23.6%) in Q1 to £86.5m. By contrast, revenue from physical formats fell by 15.1% to £69.3m.
Digital album sales increased by 22.7% to £35.9m, and income from streaming services such as Spotify and We7 raked in revenues of £3.4m, an increase of 20% on Q1 2011. The increase in these figures helps compensate for the fall in physical music sales, as more and more users browse, purchase and listen to their music digitally.
Services like Spotify have grown tremendously, establishing partnership deals,expanding into the USA, and even diversifying into selling music to own, all of which have helped establish them as a viable alternative to iTunes and Amazons MP3 store.
BPI Chief Executive Geoff Taylor said:
This is a significant milestone in the evolution of the music business. UK record labels have embraced digital to their core, supporting innovation and licensing more new online and mobile services than any other country. As a result, the industry’s prospects for growth look brighter than for several years.