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Streaming Music, Circa 2014

First published on http://hereisthecity.com/

In the news this past week were some startling figures from Nielsen SoundScan covering music sales in the U.S. in the first 6 months of 2014.

SoundScan figures released Thursday, July 3, show 70.3 billion songs streamed in the U.S. in the first 6 months of 2014. SoundScan says the number is 42 percent above the number streamed in first-half 2013.

Why the increase in streaming in 2014?

One factor in the sharp increase in streaming this year is a sudden and dramatic decrease in digital downloads (sales), other SoundScan figures show.

At the Apple iTunes store, downloads declined 6 percent in 2013, from the year before. The 2013 decrease was the first time Apple suffered a decline in downloads since it began selling songs at 99 cents a track in 2003.

The 2013 decline was, therefore, a sudden and surprising reversal of what had been a slowing, but nevertheless unbroken string of yearly increases. And the decline at the iTunes store is continuing into 2014, with downloads in the first 6 months of this year down 13 percent from the first 6 months of last year.

The SoundScan figures released July 3 also show that 120.9 million albums were sold in the first 6 months of 2014, a decline of 14.9 percent compared to the first 6 months of 2013. Taken separately, sales of CDs were down 19.6 percent, and digital downloads were down 11.6 percent, compared to the first 6 months of 2013.

But the most important reason streaming is up so dramatically in the first 6 months of 2014 — (up 42 percent to 70.3 billion songs) — appears to be that streaming is often free to the consumer. The royalty on one streaming of a single song can be less than one cent — and many kinds of streaming, especially of older material, involve no royalty at all.

Advertising often pays for streaming that is then free to the consumer (and is, of course, accompanied by the advertising) — and there are sites that exist in whole or in part to provide free music streaming. Some sites provide free streaming as an inducement to subscribe — and some provide free trials.

We can’t know, of course, where recorded music will go next — and we can’t know whether, or when, recorded music will be largely or entirely “free.”

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