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U.S. Music Fans Continue Shift to Streaming Services as Apple Readies Beats Revamp

Paid music downloads, which have dominated the digital music market for years thanks in large part to Apple's iTunes Store, showed accelerating weakness in the United States last year as music streaming services like Spotify and a resurgence of vinyl record sales exploded in popularity.

According to Nielsen SoundScan (via The Wall Street Journal), streaming music grew a remarkable 54 percent in 2014, moving from 106 billion songs in 2013 to 164 billion in 2014. That growth contrasts with traditional song downloads that dropped off significantly from 2013. Paid downloads for full music albums declined 9 percent in 2014, with individual song downloads seeing an even larger 12 percent drop-off. Overall, according to SoundScan, Americans bought 257 million albums in 2014, 106.5 million of which were downloaded digitally.

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Amid the digital shift from individual downloads to streaming, an older technology also saw a resurgence in 2014 with vinyl record sales at their highest levels since SoundScan began tracking music sales in 1991. Nielsen's tracking shows 9.2 million vinyl records sold, representing a 52 percent overall increase in sales from 2013.

With lackluster overall digital music downloads mirroring a similar drop in iTunes Store sales, Apple has been looking at ways to improve its positioning in the music market. Apple's initial effort with iTunes Radio to offer a Pandora-like experience that also seeks to drive iTunes Store purchases has had a less-than-stellar reception with availability in only the United States and Australia. That weak entry likely spurred Apple to pursue last year's acquisition of Beats Music for a full-fledged subscription streaming service.

Recent reports have indicated that Apple will be pursuing a major revamp of Beats early this year that may see prominent integration of the paid streaming service into iOS and iTunes, perhaps including a rebranding under the iTunes name.



Top Rated Comments

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21 months ago

downloaded digitally


How else would they be downloaded? I'm wondering why downloadable movies, games, and music are being referred to as "digital" downloads as opposed to just "downloads" or something more sensible and less redundant.
Rating: 31 Votes
21 months ago
ugh just goes to show how little people these days care about music. I want to OWN the music i listen to and just have my albums as always
Rating: 30 Votes
21 months ago

Its amazing how parents have failed to educate their children in regards paying for what amounts to a glorified radio station.


Are you referring to Spotify? Because that's not what it is. You can download and save any album to your devices. Their music catalogue has almost everything. The monthly fee is less than the cost of *one* album per month. What's not to like? Spotify is incredible.
Rating: 25 Votes
21 months ago
I guess I'm old, or just don't get it...

I guess I'm old, or just don't get it...

I'll never understand "renting" music. I can't begin to see the appeal, I don't see any value.

If I want a semi-random stream of audio that I may or may not like, or be in the mood to listen to at any given moment, I already have that, it's called a radio... it's not dependent on an internet connection, and it's FREE.

I'll gladly pay to have the songs I actually like, stored on my devices, organized in playlists I can choose based on my mood, and not have to pay a monthly fee, and not be at the mercy of an internet connection and it's reliability (or lack of).

I can't begin to understand where anyone sees the value in the music rental business. Seems like flushing cash down the toilet to me.

Of course, I completely understand companies like Apple rushing to take money from suckers that are willing, hell eager even, to rent music.

Shrug.

Oh yeah..

And git off my lawn!
Rating: 20 Votes
21 months ago

sure it is convenient but only if you are connected to the mothership and prepared to may thoe sometimes silly mobile data charges.

So you go to Europe on holiday and suddenly you are into hundreds of $$$ in roaming charges. Opps!
What price convenience now?

I travel all over the world. My music collection fits nicely on my iPod 64Gb.
Apart from the U2 freebie, I buy it all on CD.
Even better convenience methinks.
But there agaion, I'm not 21 any more. If I was, I'd have seen Hendrix's last gig on the Isle of Wight in the last 6 months. I'm clearly not the taget market for streaming and as long as the Music Moguls don't forget that in many western counties there will soon be more wrinklies than youngsters all will be fine.


There appears to be a lot of misunderstanding of how services like Spotify and Beats actually work.

If you need tracks available to you offline, you simply download them to your device and listen to them as desired. This is no different than syncing your iPod with tracks that you purchased in iTunes. The added benefit is that if there is a song you forgot to bring along you can get it at any time if you so choose. In our increasingly mobile world, this model is rich with value to a large percentage of the market.
Rating: 15 Votes
21 months ago
Its amazing how parents have failed to educate their children in regards paying for what amounts to a glorified radio station.
Rating: 14 Votes
21 months ago

Still not as diverse as I want. Last time I checked, there aren't many Japanese songs in their collection. For physical copies, there is no such limitation.


Which is fine, but your desire to listen to Japanese music is not the norm in the U.S.

Your corner case does not invalidate the mainstream use case.
Rating: 12 Votes
21 months ago

Its amazing how parents have failed to educate their children in regards paying for what amounts to a glorified radio station.


With 164 billion songs streamed, consumers clearly value access and convenience. It is fine to have a different philosophy regarding your consumption of media, but summarily dismissing those with a different view doesn't make any sense.

Apple is going to follow the market. There's no reason not to.
Rating: 11 Votes
20 months ago
It's impressive to see how Apple has dropped the ball in digital music.

They had it all: a working online store with a huge selection of music, good physical and software players, a device connector that became a de-facto standard so that you could easily plug in your iPod or iPhone 4 into your hotel room's hifi set.

And what did they do ? Every version of iTunes got worse than the one before. Even worse Apple's marketing totally ignored the music streaming market. Now they bought a headphones brand and their more or less unknow streaming service for a fortune, just to realize that the brand doesn't really fit to Apple. They changed their phone connector and killed the standard.
Rating: 11 Votes
21 months ago

99% of consumers don't care about even higher quality music, album artwork, etc. They want a diverse collection at a low price that is instantly accessible.


Guess I'm the 1%.
Rating: 10 Votes

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