A Music Streaming Boom is Spelling Trouble for Music Sales

Spotify It took a long time to get going, but streaming music is finally mainstream. It’s a business, too, generating more than $1 billion a year. That sounds like good news for the music labels, which have been waiting for digital music sales to replace the ones that disappeared after CD sales peaked 14 years ago. The problem for the music business is that most music streamers — around 80 percent of them — are free music streamers, relying on services like YouTube, Pandora and SoundCloud for the tunes, says Midia Research. And those ad-supported businesses generate about 10 percent of the revenue per user that subscription businesses do. Insult to injury: Many people who do stream music say they’ve cut down on music purchases. Of course they have! If you can listen to any song you want, whenever you want, there’s no need to buy a song.

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