The global recorded music market grew by 5.9 percent in 2016 to reach $15.7bn (£12.2bn), the latest IFPI Global Music Report has revealed.
According to IFPI, the growth rate was the highest since the organisation began monitoring the music market in 1997.
By the end of 2016, 112 million users of paid music streaming subscriptions were tracked, driving year-on-year streaming revenue growth of 60.4 percent.
Digital income in 2016 also accounted for half of the global recorded music industry’s annual revenue for the first time.
The growth in streaming helped negate a 20.5 percent decline in downloads and a 7.6 percent drop in revenue from physical product.
At the same time, the report highlighted the value gap as the biggest challenge facing the music industry. The gap is cited as the growing mismatch between the value that user upload services, such as YouTube, extract from music and the revenue returned to those who create and invest in music.
Frances Moore, IFPI chief executive, said: ‘The industry’s growth follows years of investment and innovation by music companies in an effort to drive a robust and dynamic digital music market.
‘Music’s potential is limitless, but for this growth to become sustainable – for investment in artists to be maintained and for the market to continue to evolve and develop – more must be done to safeguard the value of music and to reward creativity.
‘The whole music community is uniting in its effort to campaign for a legislative fix to the value gap and we are calling on policymakers to do this. For music to thrive in a digital world, there must be a fair digital marketplace.’
PRS for Music recently announced it’s financial figures for 2016, stating it had broken UK music history to pay out more than half a billion pounds to creators.
Read our recent interview with PRS for Music’s chief executive Robert Ashcroft on the success and the challenges facing the organisation and wider industry.