3 January 2020: Spending by UK music fans on streaming services exceeded £1bn for the first time in 2019 as overall expenditure on entertainment increased to another all-time-high, according to preliminary data compiled by the Entertainment Retailers Association (ERA).
That £1bn total spent on music subscription services from the likes of Spotify, Apple Music, Amazon Music, YouTube Music and Deezer is four times as much as just five years ago and an incredible 31 times the level in 2010.
Despite falls in sales of physical music, video and games formats, strong demand for digital services was sufficient to produce overall entertainment market growth of 2.4% to £7.8bn, its seventh consecutive year of growth.
|
UK CONSUMER SPENDING ON ENTERTAINMENT 2019 |
||||
|
|
2018 |
2019 |
% change |
|
|
Music |
Physical |
£383.2 |
£318.1 |
-17.0% |
|
|
Downloads |
£122.6 |
£89.7 |
-26.8% |
|
|
Streaming |
£812.0 |
£1,002.9 |
23.5% |
|
|
Total Music |
£1,317.8 |
£1,410.7 |
7.1% |
|
|
|
|
|
|
|
Video |
Physical Retail |
£616.9 |
£477.2 |
-22.6% |
|
|
Physical Rental |
£31.1 |
£23.4 |
-24.8% |
|
|
Digital |
£1,736.5 |
£2,109.4 |
21.5% |
|
|
Total Video |
£2,384.4 |
£2,610.0 |
9.5% |
|
|
|
|
|
|
|
Games |
Physical |
£769.9 |
£602.6 |
-21.7% |
|
|
Digital |
£3,136.4 |
£3,171.5 |
1.1% |
|
|
Total Games |
£3,906.3 |
£3,774.1 |
-3.4% |
|
|
|
|
|
|
|
Total Entertainment |
Physical |
£1,801.1 |
£1,421.3 |
-21.1% |
|
|
Digital (inc streaming) |
£5,807.4 |
£6,373.5 |
9.7% |
|
|
Total Entertainment |
£7,608.5 |
£7,794.8 |
2.4% |
Sources: Music: Physical/digital – The Official Charts Company. Streaming estimates – ERA/BPI.
Video: Physical retail – The Official Charts Company/BASE. Physical rental – IHS Markit. Digital - Futuresource Consulting estimates of transactional digital video including EST (Electronic Sell-Through) Movies & TV, iVoD (online digital rental) and CVoD/Pay-TV VoD (digital rental via Pay-TV providers to a STB). Adult & PPV sports are excluded. SVoD (Subscription video on demand) - Online subscription streaming services such as Netflix and an allocation of Amazon Prime revenue. Now TV movies, entertainment & kids is also included within this, but sports is excluded).
Games: Physical – GfK Chart Track. Digital – IHS Markit estimates (including digital online, mobile and tablet gaming)
ERA CEO Kim Bayley said, “The rise of digital entertainment services has created the biggest revolution in UK leisure habits in history, enabling people to access the music, video and games they love wherever and whenever they want, and transforming the fortunes of record labels, filmmakers and games developers. The fact that in 2019 over 80% of entertainment spending was on digital services shows the scale of that revolution.”
PHYSICAL DOWN, BUT NOT OUT
The flipside to digital’s success has been increasing pressure on sales of physical formats. Expenditure on physical music, console games and DVDs further decreased in 2019 with sales of physical products down on average around 20%.
“There is no doubt retailers of physical product had a tough time in 2019,” said Bayley, “but physical entertainment was still a £1.4bn retail business. Sales of vinyl and 4K Ultra HD discs are buoyant and still growing and we still have huge hit phenomena like FIFA 20 which can sell 1.5m physical units at around £40 a time. Physical is down, but it’s definitely not out.”
VIDEO WAS 2019’s FASTEST GROWING SECTOR
While expenditure on entertainment overall grew by 2.4% in 2019, spending on video surged by 9.5% driven entirely by the continuing rise of digital, ranging from downloads from Amazon, Apple and Sky Store and increasingly from streaming services such as Netflix, Amazon Prime and Sky’s Now TV.
Digital video sales grew by 21.5% to £2.11bn, while physical revenues decreased 22.7% to £500m. In cash terms it meant Britons spent £147m less on physical video formats in 2019 than in 2018, but £373m more on digital and subscription.
The biggest video hit of 2019 was the Queen biopic Bohemian Rhapsody with 1.7m copies sold, two thirds of them on physical formats.
ERA CEO Kim Bayley said, “Video’s digital renaissance is remarkable, but it is undeniable that physical formats are the key to scoring a blockbuster hit. Every one of the year’s Top 10 biggest hits sold more on DVD and Blu-ray than they did digitally.”
|
THE UK'S BEST-SELLING VIDEOS 2019 |
|||||
|
|
Title |
Studio |
Units Sold |
% Phys |
% Dig |
|
1 |
Bohemian Rhapsody |
20th Century Fox |
1,700,683 |
67.2% |
32.8% |
|
2 |
Avengers - Endgame |
Walt Disney Studios |
1,305,647 |
59.2% |
40.8% |
|
3 |
Toy Story 4 |
Walt Disney Studios |
789,310 |
67.6% |
32.4% |
|
4 |
Mary Poppins Returns |
Walt Disney Studios |
717,909 |
75.1% |
24.9% |
|
5 |
A Star Is Born |
Warner Home Video |
701,984 |
n/a |
n/a |
|
6 |
The Lion King |
Walt Disney Studios |
659,561 |
71.9% |
28.1% |
|
7 |
Venom |
Sony Pictures |
653,497 |
66.3% |
33.7% |
|
8 |
Captain Marvel |
Walt Disney Studios |
638,187 |
70.5% |
29.5% |
|
9 |
Aladdin |
Walt Disney Studios |
637,092 |
67.3% |
32.7% |
|
10 |
Fantastic Beasts - Crimes Of Grindelwald |
Warner Home Video |
591,862 |
n/a |
n/a |
Source: Official Charts Company, weighted as per BASE. Note - EST volumes include Film on Video and Children's Video ' Animated Film' Titles Only
GAMES SUFFERS FROM END OF CONSOLE CYCLE
Games remains entertainment’s biggest sector, nearly as large as video and music combined, but after years of growth in 2019 the sector shrunk by 3.4% to £3.77bn - its first year without growth since 2012.
The reason for the stumble was the inevitable slowdown in sales ahead of the expected launch in late 2020 of the new PlayStation and Xbox consoles. The last such downturn came ahead of the launch of the current generation of Sony and Microsoft consoles in 2013.
Expenditure on physical games software declined 21.7% in 2019 to £602.5m, while spend on online and mobile gaming increased 1.1% to £3.17bn.
Biggest-selling physical title of the year – digital title information is currently not available – was FIFA 20. The latest edition of the blockbuster generated sales of 1.5m units and revenues of around £73m.
ERA CEO Kim Bayley said, “The key message from the games business in 2019 is we need those two new consoles from PlayStation and Xbox – and soon.”
|
THE UK'S BIGGEST-SELLING PHYSICAL CONSOLE GAMES 2019 |
|||
|
|
Title |
Company |
Physical Unit Sales |
|
1 |
FIFA 20 |
ELECTRONIC ARTS |
1,502,191 |
|
2 |
Call Of Duty: Modern Warfare |
ACTIVISION BLIZZARD |
1,192,211 |
|
3 |
Mario Kart 8 Deluxe |
NINTENDO |
465,062 |
|
4 |
Star Wars Jedi: Fallen Order |
ELECTRONIC ARTS |
438,465 |
|
5 |
Red Dead Redemption 2 |
TAKE 2 |
306,392 |
|
6 |
FIFA 19 |
ELECTRONIC ARTS |
278,417 |
|
7 |
Pokemon Sword |
NINTENDO |
273,991 |
|
8 |
Crash Team Racing Nitro-Fueled |
ACTIVISION BLIZZARD |
267,285 |
|
9 |
Grand Theft Auto V |
TAKE 2 |
247,357 |
|
10 |
Tom Clancy's The Division 2 |
UBISOFT |
237,226 |
Source: GfK Chart Track
MUSIC SEES FIFTH YEAR OF GROWTH THANKS TO STREAMING
Music fans spent £1bn on subscription streaming services in 2019, meaning they spent more than twice as much accessing music than they did acquiring it on physical formats or through downloads (£407.8m).
With growth of 23.5% compared with 2018, those streaming services delivered record labels a fifth successive year of growth.
Physical formats and downloads of singles and albums were less buoyant, declining by around 20% compared with the previous year.
However vinyl sales again bucked the physical trend, increasing 6.4% to £97.1m.
Biggest selling album of the year was Lewis Capaldi’s debut Divinely Inspired To A Hellish Extent with sales of around 641,000.
ERA CEO Kim Bayley said, “As more and more people sign up to streaming services, it obviously becomes a challenge to maintain the same rate of growth, but the fact is UK music fans spent £190m more on subscription streaming services in 2019 than they did the year before – that’s more than twice the value of the entire vinyl market.”
|
THE UK'S BIGGEST-SELLING ALBUMS 2019 |
||||||
|
|
Title |
Artist |
Company |
Total Units |
% Physical |
% Streaming/Digital |
|
1 |
Divinely Uninspired To A Hellish Extent |
Lewis Capaldi |
Universal Music |
640,892 |
39.8% |
60.2% |
|
2 |
No 6 Collaborations Project |
Ed Sheeran |
Warner Music |
568,110 |
36.8% |
63.2% |
|
3 |
The Greatest Showman |
Motion Picture Cast Recording |
Warner Music |
523,844 |
40.3% |
59.7% |
|
4 |
When We All Fall Asleep Where Do We Go |
Billie Eilish |
Universal Music |
369,609 |
27.0% |
73.0% |
|
5 |
Staying At Tamara's |
George Ezra |
Sony Music |
331,949 |
49.2% |
50.8% |
|
6 |
Bohemian Rhapsody - OST |
Queen |
Universal Music |
331,244 |
25.5% |
74.5% |
|
7 |
Thank U Next |
Ariana Grande |
Universal Music |
293,232 |
14.1% |
85.9% |
|
8 |
What A Time To Be Alive |
Tom Walker |
Sony Music |
269,551 |
60.7% |
39.3% |
|
9 |
Now That's What I Call Music 102 |
Various Artists |
Sony Music/Universal Music |
250,626 |
85.3% |
14.7% |
|
10 |
A Star Is Born |
Motion Picture Cast Recording |
Universal Music |
242,418 |
49.0% |
51.0% |
Source: Official Charts Company
A DECADE IN REVIEW – GAMES THE STAR PERFORMER
The close of 2019 marks the end of one of the most tumultuous decades in UK entertainment history, said ERA CEO Kim Bayley.
“Since 2010, the combined music, video and games markets have grown by a third thanks primarily to the innovation and investment of digital services and retailers. The stand-out performer, however, is clearly games – up an incredible 76.2% over the past 10 years.”
Key to games’s success has been not just adding downloads and streaming to existing games formats but also exploiting mobile and tablet technologies to create new games markets.
|
ENTERTAINMENT EXPENDITURE - 2019 VERSUS 2010 (£m) |
||||
|
|
2010 |
2019 |
% change |
|
|
Music |
Physical |
£872.6 |
£318.1 |
-63.5% |
|
|
Downloads |
£280.1 |
£89.7 |
-68.0% |
|
|
Streaming |
£31.5 |
£1,002.9 |
3083.7% |
|
|
Total Music |
£1,184.2 |
£1,410.7 |
19.1% |
|
|
|
|
|
|
|
Video |
Physical Retail |
£2,090.0 |
£477.2 |
-77.2% |
|
|
Physical Rental |
£277.7 |
£23.4 |
-91.6% |
|
|
Digital |
£154.1 |
£2,109.4 |
1268.8% |
|
|
Total Video |
£2,521.8 |
£2,610.0 |
3.5% |
|
|
|
|
|
|
|
Games |
Physical |
£1,527.0 |
£602.6 |
-60.5% |
|
|
Digital |
£614.7 |
£3,171.5 |
415.9% |
|
|
Total Games |
£2,141.7 |
£3,774.1 |
76.2% |
|
|
|
|
|
|
|
Total Entertainment |
Physical |
£4,767.3 |
£1,421.3 |
-70.2% |
|
|
Digital (inc streaming) |
£1,080.4 |
£6,373.5 |
489.9% |
|
|
Total Entertainment |
£5,847.7 |
£7,794.8 |
33.3% |
Sources: Music: Physical/digital – The Official Charts Company. Streaming estimates – ERA/BPI.
Video: Physical retail – The Official Charts Company/BASE. Physical rental – IHS Markit. Digital - 2010 ERA Estimates / 2019 Futuresource Consulting estimates of transactional digital video including EST (Electronic Sell-Through) Movies & TV, iVoD (online digital rental) and CVoD/Pay-TV VoD (digital rental via Pay-TV providers to a STB). Adult & PPV sports are excluded. SVOD (Subscription video on demand) - Online subscription streaming services such as Netflix and an allocation of Amazon Prime revenue. Now TV movies, entertainment & kids is also included within this, but sports excluded)
Games: Physical – GfK Chart Track. Digital – IHS Markit estimates (including digital online, mobile and tablet gaming)
ENDS
ERA CEO Kim Bayley is available for interview
For more information please contact Steve Redmond steve@eraltd.org (07770 924720)
About ERA
ERA is the trade association representing the vast majority of retailers and digital services offering music, video and games. Its members range from independent record shops (Reflex, Sister Ray) to digital services (Spotify, YouTube, Sky, Deezer, Virgin) to internet retailers (Amazon) to specialist High Street operators (HMV, Game) and supermarkets (Tesco, Sainsburys, Asda, Morrisons)
ERA members supply the sales data which powers the Official Charts Company (music and video charts) and GfK Chart-Track and GSD (videogames). Together with record companies trade association the BPI, it owns the Official Charts Company.
ERA provides the organisational force behind Record Store Day, the annual celebration of independent record stores which has become the most successful new music industry promotion of the past two decades.
ERA works closely with its sister organisations in music, video and games and is a strong proponent of open markets, open standards and consumer choice.