Midyear Music Report: U.S. Streams Rise a Solid 10.6%, Per Luminate; Latin and Country Heat Up, While Vinyl Growth Cools

Continued growth in streaming is delivering another upbeat year for the music business, both in the U.S. and globally, according to Luminate’s 2022 Midyear Report. The study also shows Latin and country continuing to gain ground in streaming, with Bad Bunny proving a catalyst for the former. But the report’s biggest surprise might be that a music configuration which has enjoyed more than a decade of growth could see its growth streak plateauing: the LP.

With on-demand song streams showing a 10.6% lift over the first half of 2021 in the U.S., Luminate reports a 9.3% rise in U.S. Total Album Consumption (album sales plus equivalent revenue from song sales and streams) and a 12.4% gain in on-demand audio streams.

Global streaming growth continues to be even more pronounced, as 1.6 trillion audio plays worldwide represents 24.7% growth over H1 2021, while video streams rose 28.1% to 901.5 billion. And those gains are on top of very solid growth that was happening last year, on-demand audio streams were up 26.3% in 2021.

Daniel Ives, managing director of equity research at Wedbush Securities, notes music streaming has avoided that post-pandemic slump impacting video platforms. “It shows engagement continuing post pandemic. Many pundits thought it would fall off a cliff going into 2022 but it’s held firm. It’s bullish for streaming music, ultimately very positive for Spotify, Apple Music and the other players.

“You’ve seen more and more consumers who accelerated streaming music during the pandemic who have maintained a pretty good pace, which goes against what we’ve seen on streaming TV,” Ives adds. “You’d expect that the trend line would be very similar to what you’re seeing with Netflix and others in terms of engagement, but it’s actually not.”

Luminate’s full report can be downloaded here. (Luminate, the data company that was still called MRC at the start of this year,  is owned by PMC, which includes Variety, Billboard and Rolling Stone among its holdings.)

Country and Latin continued to thrive in this year’s first half. These two popular genres trailed the field when streaming first took off, but they are the ones that gained the most traction in the COVID-impacted years of 2020 and 2021.

When Bad Bunny’s May 6 release “Un Verano Sin Ti” opened at No. 1 on the Billboard 200 with 274,000 equivalent album units (album sales plus value from song streams and sales), the Latin category scored the most streams in a week that either genre has enjoyed to that point, registering 2.2 billion on-demand audio and video plays for that tracking period.

Bunny is the obvious Pied Piper for the category, and the Luminate report highlights his significance. The week his new album arrived, it held a 16% consumption share for Latin streams, and in the first half of the year, he owns 5% of the genre’s streams. Luminate says 38% of consumers who are aware of the artist consider him an influencer.

More than that, as illustrated by his chart-topping start in May, Luminate finds that awareness of Bad Bunny beyond Latin music fans runs high, known by 28% of the general population. Among Latin artists, that’s a bigger share than earned by the late Vicente Fernández (17%), Latin Urban star Maluma (15%) and Reggaeton champ Karol G (13%). Only television-elevated Shakira and the late icon Selena rate higher awareness, at 72% and 64%, respectively.

“There’s no question that Latin music consumption has grown dramatically in absolute terms, never mind just the growth rates from five years ago,” says Larry Miller, director of the music business program at New York University’s Steinhardt School.

“There’s no bigger or better story I think than the Bad Bunny story. When you look at who the biggest acts are that are driving streaming consumption, there’s no surprise there,” Miller adds. “The great story for the DSPs and anyone associated with those artists and that is the availability of those services that impact these stream counts in particular, reducing friction in the modern world and the way that music is discovered today.”

Luminate shares several data points to illustrate Latin’s increasing reach, stating that 40% of Latin music listeners are not Hispanic or of Hispanic origin, and that they spend 69 hours a month with music, 25% more than the average consumer. Fans of the genre dig deep for live music, too, says Luminate, citing that they spend $84 a month on live events, 25% more than average.

Among the Latin subgenres, salsa has the highest share at 41%, followed by reggaeton (36%), Latin rock (31%) and Latin urban (30%).

Not long after Bad Bunny’s album instigated Latin’s biggest streaming week, country also scored its two best streaming weeks, reaching 1.97 billion audio and video plays in the week ending June 2, and 1.95 billion in the week ending July 1. That second week corresponded with the debut of Luke Combs’ “Growin’ Up,” which debuted at No. 1 on the Country Albums chart and No. 2 on the Billboard 200 with 74,000 equivalent units.

“Latin and country audio streaming growth have both been generally outpacing the larger industry over the last five years, but Latin’s growth has outpaced country’s growth so far in 2022, with Latin showing a 33% increase and country showing a 9% increase,” says Luminate’s report.

News about actual sales is not so positive, although no one expected it to be at this late date. After an anomalous 2021, when Adele and Taylor Swift were key factors to U.S. album sales posting their first gain in 10 years — with even CDs showing 1.1% growth — the new midyear tallies show regressions to the norm on both counts. Combined physical and digital albums sold 8.4% less than in H1 2021 (46.9 million) and CDs dipped 10.7% (16.9 million).

The other declines seen in the first six months of ‘22 are on par with the sales patterns of recent years, with physical albums down 4.7% (36.5 million), digital albums dropping 19.6% (10.4 million) and digital songs off by 21.4% (80 million).

What looks surprising, for a category that has shown year-over-year growth every year since 2008, is the mere 1% growth posted by vinyl, in stark contrast to the 108.2% burst shown in H1 2021, and 51.4% growth earned throughout the year. Here’s where the music business gets lured into the same quandaries that have impacted most consumer goods over the past couple years: supply chain issues and a subsequent shortage of raw materials.

Informed sources at two of the majors say that severely limited pressing capacity have forced labels to either delay the vinyl component of some releases, or in the case of some major pop acts, to hold off an album’s debut until vinyl is available, with one executive noting that pandemic economics have driven up both wholesale and retail pricing on LPs.

An experienced analyst at one of the major labels was not surprised by vinyl’s shift into lower gear, noting that current product (releases less than 18 months old) have actually seen a 27% gain in H1 2022. It’s an 8% decline in catalog, which accounts for the bulk of LP sales, that tamps down the configuration’s growth.

Another label source points out that 2021 is the year when mass merchants accelerated their involvement with the configuration, new business that significantly contributed to vinyl’s fast growth, both in the midyear and year-end reports. Now, the whole retail matrix competes with that larger swath of vinyl-stocked stores.

Last year, Adele’s “30” became the year’s best selling LP, moving 318,000 copies in less than two months, while Taylor Swift, who sold more vinyl than any other artist in 2021, had three of the top 10 LPs, her re-record of “Red” (260,000) and the 2020 releases “Evermore” (249,000) and “Folklore” (195,000). All in, Swift sold 866,500 LPs last year; in fact, she and Adele combined accounted for 2.8% of that configuration’s sales.

Competing with Swift and Adele’s 2021 LP numbers could be a challenge for the industry in the second half of this year. The vinyl slowdown becomes more puzzling when you realize that the LP versions of both Harry Styles’ “Harry’s House” and Olivia Rodrigo’s “Sour” both outpace the 143,000 units that made Swift’s “Evermore” the top LP for H1 2022. Styles rang up 279,000 vinyl LPs since the album arrived on May 22, with Rodrigo adding 155,000 copies since the start of this year to add to her 2021 yield, when she sold 268,000 LPs.

Industry watchers were startled when the year-end 2021 report revealed that catalog product — recordings that have been out for 18 months — accounted for 74.5% of music consumed in the U.S., but the shift toward catalog happened as soon streaming became the locomotive of the music business.

The tilt toward catalog remains high in 2022, but accounts for a slightly smaller share, 72.4%, in the first half. Current product — new releases and those less than a year and a half on the market — sees its share shift from 30.6% at the midpoint of 2021 to 27.6%, but with a much smaller drop in volume, 1.4%, than the 15.3% decline it saw throughout the previous year.

New to Luminate’s midyear data are its “Similarity Scores,” which show how much music is shared among different global markets. There is, for example, a 75% correlation between songs consumed in the U.S. and its northern neighbor Canada. Australia is next with a 62% correlation while New Zealand ranks third with 61%. Mexico, meanwhile, sees its highest correlation with Bolivia and Ecuador, each at 58%, with Chile ranked third, with 56% of its most consumed repertoire overlapping with Mexico’s top tunes.

Said Luminate CEO Rob Jonas in a statement, “So far in 2022, the story is very much about the continued massive growth of streaming on a global scale. In fact, we’re seeing a 25+% growth in on-demand streaming music consumption, inclusive of both audio and video, across all markets over this time last year. Taking that growth into consideration, along with the increased accessibility to music streaming services amongst a myriad of different audiences, we’ve been able explore the nuances of this year’s most notable trends … Our hope is that these findings are not only useful in making sense of where music stands today, but that they also can help plan for tomorrow, whether in creative pursuits or in business ventures.”

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