Video killed the radio star, but vinyl records can still survive CDs.
Vinyl albums surpassed CDs last year for the first time since 1987, according to the Recording Industry Association of America, an industry trade group. About 41 million vinyl albums were sold in 2022, compared to about 33 million CDs, the RIAA said in its year-end report released Thursday.
The numbers contributed to another banner year for the music industry. Recorded music sales rose 6% to a record $15.9 billion last year, the seventh consecutive year of growth, according to the RIAA, with streaming continuing to be the main driver of recent expansion Of the industry.
Vinyl’s resurgence has been brewing for years, fueled primarily in the United States by indie rock fans convinced of the LP’s superior sound quality and young people drawn in by the nostalgia of playing records.
Constant demand has turned record manufacturing into a largely cottage industry, with some buyers asking for novelty vinyls – multi-colored, scented, glow-in-the-dark – that add to the cachet of owning vinyl.
Vinyl record revenues rose 17% to more than $1.2 billion last year, the 16th straight year of growth for the format and nearly double what it was two years ago. Vinyl albums accounted for 71% of revenue from the physical format, which includes items such as CDs, tapes and DVDs, and 7.7% of overall revenue, the RIAA said.
CD revenues fell 18% last year to $483 million, the RIAA said.
The resurgence of vinyl coincides with the continued growth of streaming, a category that includes Spotify Technology SA, Alphabet Inc.
Youtube and others. Streaming, which includes paid subscriptions, ad-supported services and on-demand apps, among others, accounted for 84% of industry revenue, the RIAA said.
The music industry began to recover in 2016, when the growth of streaming services began to outweigh a long-running decline in CD sales amid rampant online piracy. Revenue from paid subscription services grew 8% to $10.2 billion in 2022, topping $10 billion a year for the first time, according to the report.
On-demand music services reached an annual average of 92 million paying subscribers, up from an average of 84 million in 2021, the RIAA said.
Music revenue from ad-supported services such as YouTube, Spotify, Facebook,
and others grew at a slower pace than previous years, up 6% to $1.8 billion. Ad-supported services accounted for 11% of total recorded music revenue in 2022.
Revenue from on-demand digital downloads fell 20% to $495 million, according to the report. Revenues from albums and single track downloads have plummeted.
Digital downloads accounted for just 3% of recorded music revenue in the United States in 2022, a sharp drop from a peak of 43% in revenue in 2012, the RIAA said.
Write to Ginger Adams Otis at Ginger.AdamsOtis@wsj.com
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Appeared in the March 10, 2023 print edition as “Vinyl Outsells CDs for the First Time Since 1987”.