9The Global Music Industry

The global music industry is in flux. The industry had been highly challenged by the shift away from physical sales, which were dominated by CDs. From the 1890s to the 1990s, sales of recorded music had meant sales of physical copies. The 1990s, however, saw the emergence of the mp3 format, along with widespread music piracy. By 1999, the keyword “mp3” had become more popular than the word “sex” as an Internet search term.1 In 2003, South Korea became the first nation in which digital music sales surpassed physical sales.

More recently, music streaming services, some of them subscription‐based, have revolutionized the music industry and are credited with initiating a gradual restoration of profitability to that industry. In addition, according to some reports, the presence of inexpensive or free streaming services is credited with reducing global music piracy.2 Streaming has begun to be heralded as the savior of the industry.

Global music industry revenues rose by 8% in 2017, with sales via streaming subscriptions constituting the industry's largest single revenue source. Companies like Walmart, which had been gambling first on physical (CD) sales and then on sales by download, have missed out. Download revenue dropped by 20% in the same year, while physical sales continued to dwindle.3

Another surprising development has been the growth in popularity of video‐sharing sites like YouTube as a means of accessing music. The ease with which music videos ...

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