We predicted that it would happen someday, now it has. RIAA's recent figures for the first half of 2014 shows that physical sales continues to drop..now at 28% of total revenue. Revenue for the first half fell from $3.4 billion to $3.2 billion. This is, of course, for record companies that are part of the RIAA and do not include the tens of thousands of independent artists who record and sell their own CDs on line or at their gigs. But, most interesting is the growth of streaming media services like Pandora, SiriusXM, Rhapsody, Spotify and others. That number is up from $673 million last year to $859 million this year..a growth of 28%. Streaming media services now are 27% of the total record industry ad revenue. Permanet music downloads, such as Itunes fell to overall 41% of total revenue. That was $1.486 billion in 2013 and $1.305 billion in 2013. Ringtunes and Ringbacks fell even further and now comprise only 1% of revnue.
While overall record sales might be less consider the overhead of digital sales and revenue from subscriptions. There is no pressing plant, no inventory, no printed artwork, no shipping costs. It is simply record once and sell many. This has got to be good news for the big record companies but, continued bad news for the old record retailer.