Ottawa, September 6 - Music is a global experience. No civilization or society has existed without it playing a part in some form. In 2024, music’s cultural importance remains as strong as ever. Streaming platforms like Spotify, Apple Music, and YouTube Music have made this art form more readily available than ever before. With digitization, it’s easy to argue that physical media has become an outdated distribution method. The shift to digital reduces costs for record labels. Yet, whenever a new album is released, we still see the release of CDs, vinyl, and even cassettes, a surprising trend given the ease of streaming. Sales of these physical formats have been growing, making producers take notice. So, this raises an important question: in an industry dominated by streaming, what role does physical music play?

In 2023, physical music sales stood at 5.1 billion USD, whereas streaming revenue rose to 19.3 billion USD. Physical album sales grew by 3.2% to 8,044,760 units in the first six months of 2024. The growth accelerated in Q2 of 2024, with it rising to 3.9%, showcasing steady and consistent growth quarter by quarter (Paine). The music industry is quite literally as large as it ever has been.

Notably, the sale of vinyl records increased. This has risen to 12.4% year-on-year in the first six months of 2024, reaching 3,052,498 units (Paine), making up 37% of total sales so far this year. Vinyl records have been instrumental to the physical music resurgence, with value and volume both rising. For reference, vinyl sales rose 18% and 12% respectively in the United Kingdom in 2023 (CDs shine as UK music sales in 2023 jump to near record figure). This trend continues in the West, as the United States saw its 17th consecutive year of vinyl production growth (Pederson). Vinyl has become a favourite among collectors and fans who are willing to pay a premium for the format. Avid listeners claim that the instrumentals and vocals are better than what is available on streaming platforms (CDs shine as UK music sales in 2023 jump to near record figure) and are willing to pay more than twice the cost of CDs.

A prime example is Taylor Swift's album, “The Tortured Poets Department” selling 254,241 vinyl copies in the first half of 2024, leading to a surge in physical music sales (Molloy). Further boosted by the April 2024 Record Store Day, resulting in vinyl sales reaching their highest weekly total in 30 years, with 306,791 units (Molloy). Other top-selling albums include Rod Stewart & Jools Holland’s “Swing Fever” at 48,540 units, Liam Gallagher & John Squire’s album at 46,982 units, Billie Eilish’s “Hit Me Hard And Soft” with 45,434 units, and The Last Dinner Party’s “Prelude To Ecstasy” with 42,352 units sold (Mouriquand).

Interestingly, 7-inch vinyls, which are smaller records able to hold up to two songs, have been seeing a resurgence in popularity despite being less popular than their 12-inch counterpart. These sales rose by 146%, selling around 130,000 units, making it the highest in 15 years (Paine). This journalist believes that this increase is due to the novelty of the products, as its smaller form factor at one point may have been considered less desirable. Today, however, the originality of having singles isolated on their vinyl allows for a unique listening experience.

CDs, however, showed a slight decline in Q2, being 0.8%. While this can be interpreted as a negative sign, the subtle drop hints at a potential revival in the CD market. It is important to note that the reduction percentage has decreased significantly, as in 2023 CD sales fell by nearly 7%, which was a notable improvement compared to the 20% decline in 2022, suggesting potential positive growth come Q4 2024 (CDs shine as UK music sales in 2023 jump to near record figure). Analysts at The Guardian attribute this possible resurgence to price inflation and the success of exclusive, collectible albums (CDs shine as UK music sales in 2023 jump to near record figure).

Physical music still holds high value for collectors and music enthusiasts, thus catering to a niche market. These physical formats emphasize an experience among enthusiasts and collectors and offer a tangible and nostalgic experience that digital music lacks (Are digital music sales replacing Physical Music Sales?). Many artists release special edition vinyl records or CDs with their releases to appeal to this market (Are digital music sales replacing Physical Music Sales?).

Visual: Statistia’s breakdown of music market revenue worldwide from 2005 to 2023, by source. Light blue is physical sales and dark blue is streaming. Streaming is vastly more popular, however, physical sales have begun to rise, slated to continue into the near future. 

Despite physical music sales’ increased numbers, streaming still dominates as the primary form of music consumption. Notably, these services reached a record high of 23.6 billion in 2023 (Recorded Music Market Revenue Worldwide from 2005 to 2023, by Source (in Billion U.S. Dollars)) and remain the primary growth driver for the industry, with paid subscriptions playing a crucial role and having reached a record-high subscription number (Pederson). The seemingly limitless accessibility of these online streaming platforms draws in a broad user base (Are digital music sales replacing Physical Music Sales?). Should someone choose to purchase a CD or vinyl, they risk potentially disliking the album selected and having something they won’t listen to ever again. Streaming music fundamentally avoids that problem. This convenience has resulted in individuals finding and exploring new genres, discovering artists they may have never heard of, and personalizing their listening experience.

Visual: Statistia’s breakdown of global recorded music revenue from 1999 to 2023, showcased a massive spike when streaming services began to be introduced to the general public. As a result, revenue is up and higher than it has ever been. 

Streaming services, as a result, will be detrimental to the physical music industry, then? Minhyung Lee, HanByeol Stella Choi, Daegon Cho, and Heeseok Lee argue the opposite. Their article, “Can Digital Consumption Boost Physical Consumption? The Effect of online music streaming on record sales” makes the case that the two are complementary. Their research demonstrated that a 1% increase in streaming resulted in a 0.447% increase in physical CD sales, and a 1% increase in downloads led to a 0.029% increase in physical CD sales (Lee et al., 10). This insight shows that streaming services act as a way for users to discover music, which then encourages them to buy physical copies (Lee et al., 11). A complementary relationship creates an opportunity for artists and record labels to engage fans across different formats, meeting the needs of both casual listeners and dedicated collectors (Lee et al., 13). As a result, maintaining a hybrid streaming and physical model provides a platform for discovery and convenience, while also giving those who want a deeper experience an opportunity to pursue it.

From an investment perspective, purchasing physical media formats fosters a stronger bond between the consumer and the music they enjoy. Ownership creates a lasting, meaningful connection, which encourages consumers to take better care of their products (Zhu). Verge tech and music journalist Marc Masters echoes this sentiment, stating, "Putting out money for a piece of vinyl means that you’ve invested in it... the personal, intimate connection with things only happens if you own a physical copy" (Zhu).

Additionally, some may view physical media as a way to disconnect. The overwhelming nature of streaming often leads to decision fatigue, where users struggle to choose what to listen to. Instead, having fewer options and appreciating what one already owns can provide a more relaxing experience (Zhu).

"Putting out money for a piece of vinyl means that you’ve invested in it... the personal, intimate connection with things only happens if you own a physical copy," writes Marc Masters when asked about what he thinks the role of physical media in the digital age. Suggesting physical media’s ability to complete a substantial, enduring experience that digital platforms cannot replicate, despite its astonishing convenience. While digital outlets dominate in accessibility, physical media continues to thrive, with their growth only expanding in the 2020s.

Special thank you to Theo and Mik for the amazing article idea!

Works Cited:

“Are Digital Music Sales Replacing Physical Music Sales?” Mogul, www.usemogul.com/post/are-digital-music-sales-replacing-physical-music-sales. Accessed 5 Sept. 2024.

“CDs Shine as UK Music Sales in 2023 Jump to near Record Figure.” The Guardian, Guardian News and Media, 9 Jan. 2024, www.theguardian.com/business/2024/jan/09/cd-sales-uk-music-sales-2023-taylor-swift-miley-cyrus-weeknd.

“Is the Comeback of Physical Media like Vinyl Records and Dvds Here to Stay? | CBC Arts.” CBCnews, CBC/Radio Canada, 18 Apr. 2024, www.cbc.ca/arts/commotion/is-the-comeback-of-physical-media-like-vinyl-records-and-dvds-here-to-stay-1.7177810.

IFPI. "Global Recorded Music Revenue from 1999 to 2023 (in Billion U.S. Dollars)." Statista, Statista Inc., 21 Mar 2024, https://www.statista.com/statistics/272305/global-revenue-of-the-music-industry/

IFPI. "Recorded Music Market Revenue Worldwide from 2005 to 2023, by Source (in Billion U.S. Dollars)." Statista, Statista Inc., 21 Mar 2024, https://www.statista.com/statistics/292081/music-revenue-worldwide-by-source/

Lee, Minhyung, et al. “Can digital consumption boost physical consumption? the effect of online music streaming on record sales.” Decision Support Systems, vol. 135, Aug. 2020, https://doi.org/10.1016/j.dss.2020.113337.

Molloy, Laura. “Physical Music Sales Set for First Increase in 20 Years.” NME, 15 July 2024, www.nme.com/news/music/physical-music-sales-set-for-first-increase-in-20-years-3775262.

Paine, Andre. “Physical Music Sales on Course for First Increase in 20 Years.” Music Week, www.musicweek.com/labels/read/physical-music-sales-on-course-for-first-increase-in-20-years/090124. Accessed 5 Sept. 2024.

Pedersen, Erik. “Streaming-Driven Recorded Music Sales Jump 8% to $17.1B in 2023, RIAA Says; Vinyl up by Double Digits Again.” Deadline, Deadline, 27 Mar. 2024, deadline.com/2024/03/recorded-music-sales-2023-streaming-vinyl-1235869333/.

Rafi Schwartz, The Week US. “Physical Media Is Having a Moment.” Theweek, The Week, 8 Mar. 2024, theweek.com/culture-life/media/why-physical-media-is-having-a-moment. 

“Sales of Physical Music Rise for First Time in 20 Years in UK.” Euronews, www.euronews.com/culture/2024/07/16/sales-of-physical-music-rise-for-first-time-in-20-years-in-uk. Accessed 5 Sept. 2024.