New music industry figures prove what we've all known for a while, CDs are out and music streaming is in. U.S. CD sales plummeted 31.5 percent in the first quarter of 2015 while music streaming largely made up the difference with a 23 percent rise.
In the same period last year, 56.8 million CDs were sold, while this year, only 41 million of the physical disks have been sold, according to the BBC.
Music streaming has largely made up for that dip in revenue, growing by 23 percent in the first quarter compared to the same period in 2014. The Recording Industry Association of America (RIAA) announced Monday that sales in the first half of the year from streaming services, such as Spotify, YouTube, Apple Music, Rdio, Google Play Music, Tidal and more, surpassed $1 billion for the first time.
Streaming now represents one-third of the U.S. music industry, with digital downloads (largely from the iTunes store) still leading the pack despite a four percent dip in revenue, for a total of $1.3 billion in revenue.
That doesn't mean the music industry is out of its dark times by any means. The industry as a whole dropped 0.5 percent in revenue to $3.17 billion. The industry is also far lower in revenue than its peak in 1999 at nearly $15 billion.
Ever since those peak years, CD sales have taken a sharp dive thanks to music piracy, and what some would argue are too low of profit margins from music streaming services. While there's still a lot of debate about how we should stream music and how the artists should be paid through those services, there's no denying music streaming's dominance in the industry. The growth in this field is astonishing and yet less than one percent of the world's population pays for an on-demand subscription music service. That means a lot of potential moving forward.
Watch Spotify's CEO Daniel Ek talk about new innovations in his service on a recent interview on CBS This Morning.
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