The BPI has, for the first time, released statistics showing growth in non-traditional revenue streams at the record which now account for 11.4% of UK record companies’ income. The data offers some hope that labels can weather the threat from illegal; downloading as alternative revenues rose 13.8% in 2007 to £121.6 million. A big part of that rise comes from licensing which is an increasingly important revenue source. Revenues from so called 360 degree deals (“multiple-rights revenues”) where labels secure their investment in new talent on more than recording revenues – in particular touring, merchandising and sponsorship revenue were up 16.2% in 2007, though the total amount of such revenues probably weren’t very significant to start with, so actually that increase is probably quite small. Commenting on the stats, BPI boss Geoff Taylor said this: “The core business of record companies is investing in talent, working in partnership with artists to create great music and to help to find it an audience. Selling CDs and digital downloads remains the main way in which we recoup that investment, but increasingly new streams of revenue are coming into the picture. As consumption patterns change, music companies are finding new ways to recoup the huge investments they make in music. They are using new technology to find new audiences and offer consumers more choice. Today’s record business is unrecognisable to that of five years ago. Labels have rapidly evolved into digitally literate businesses that generate significant revenues through licensing”. Record companies made £943 million from music sales last year, with digital formats accounting for 8.6% of all sales income.
CMU Daily 30 June 2008 CMU www.cmumusicnetwork.co.uk