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April 5, 2013 | Music Notes Blog

A Virtuous Circle: "Accessing" Music In the Car and Otherwise

There’s been an interesting confluence of news in the last week, all interrelated and all complementary:

  • We reported our 2012 year-end sales and shipment numbers, including the increasing importance of streaming music – so-called “access models” which now total $1 billion in revenues
  • New data from NPD finding that “subscription-based and free Internet radio services accounted for nearly one quarter (23 percent) of the average weekly music listening time among consumers between the ages of 13 and 35, an increase from a share of 17 percent the previous year”
  • Booming car sales so far in 2013, which, as Glenn Peoples at Billboard observed, portend further positive news for music business:
    • “First, better integration between app and auto will mean more subscribers to services like Spotify, which allow smartphone owners to take music into the vehicle via cached files. Second, more listening to Internet radio over broadcast radio means more money. Whereas broadcast radio lacks a performance right, digital services have a performance right that results in royalties paid for Internet radio listening.”

This is a positive virtuous cycle, with each set of data points and facts further validating each other and the underlying proposition. RIAA year-end 2012 numbers showed substantial growth in these access models. NPD 2012 data showed more usage of and time spent with these types of services. And a booming car industry is leveraging fans’ appetite for these services and the popularity of music generally to offer more value to would-be customers. One example: just last week, at the New York auto show, one company touted music app integration as one of their key selling points.

All these developments are interrelated, and all suggest a streaming music market that will only further expand in importance and reach.

Jonathan Lamy
EVP, Communications, RIAA