Warner Music Group: Streaming Revenue Has Finally Surpassed Digital Downloads
The people have spoken with their wallets, and what they've said is they prefer their tunes served up on a streaming platter. Or at least that's the message music lovers are sending to Warner Music Group, which for the first time saw its streaming music revenue skip ahead of revenue from selling song downloads last quarter.
It's a fast growing category. Aided by popular services like Spotify, WMG said its streaming revenue grew 33 percent in the second quarter of its fiscal 2015. At the same time, Warner's digital revenue grew 7 percent overall, indicating that download sales went down during last quarter. It's a bit ironic given the tension between music labels and streaming services.
Even though Spotify has paid out over $2 billion to date in royalties, music labels are a handful of artists aren't happy that the streaming service has an ad-supported free tier. Artists like Taylor Swift only want their music played on paid tiers or none at all, even though Spotify's business model is clearing generating revenue.
Nevertheless, eyes are beginning to open. In a conference call to investors, WMG boss Stephen Cooper admitted "the rate of this growth has made it abundantly clear that in the years to come, streaming will be the way that most people enjoy music."
Welcome to the Internet era, WMG. Now if only Apple can get on board rather than push artists to sign exclusive agreements as it gets ready to relaunch Beats Music. Apple's recent efforts are currently being investigated by the FTC.
It's a fast growing category. Aided by popular services like Spotify, WMG said its streaming revenue grew 33 percent in the second quarter of its fiscal 2015. At the same time, Warner's digital revenue grew 7 percent overall, indicating that download sales went down during last quarter. It's a bit ironic given the tension between music labels and streaming services.
Even though Spotify has paid out over $2 billion to date in royalties, music labels are a handful of artists aren't happy that the streaming service has an ad-supported free tier. Artists like Taylor Swift only want their music played on paid tiers or none at all, even though Spotify's business model is clearing generating revenue.
Nevertheless, eyes are beginning to open. In a conference call to investors, WMG boss Stephen Cooper admitted "the rate of this growth has made it abundantly clear that in the years to come, streaming will be the way that most people enjoy music."
Welcome to the Internet era, WMG. Now if only Apple can get on board rather than push artists to sign exclusive agreements as it gets ready to relaunch Beats Music. Apple's recent efforts are currently being investigated by the FTC.
