The German market for music recordings grew by 10 percent in 2021 compared to the previous year.

"It's a milestone," said Florian Drücke, chairman of the Federal Association of the Music Industry (BVMI), in an interview with the FAZ. For the first time in 30 years, there was a double-digit percentage increase.

A total of 1.96 billion euros was turned over with music recordings last year.

"Streaming alone now accounts for more than two-thirds of total sales," Drücke continues, "but not least the example of the USA, where the streaming share is more than 80 percent, shows that there is still room for improvement."

Benjamin Fisher

Editor in Business.

  • Follow I follow

In 2020, the market had grown by 9 percent.

In a year-on-year comparison, it should of course be noted that the sale of physical sound carriers in the first half of 2020 was impacted by store closures and temporary restrictions on online shipping.

According to the BVMI, it represents around 200 music companies, which together cover more than 80 percent of the German market - including the three so-called majors Universal, Sony and Warner Music.

"The CD remains an important format"

According to the association, the digital share is now 76.4 percent.

Of this, revenue from the usual streaming services accounts for 68.3 percent (plus 18.6 percent after 24.6 percent in 2020), downloads still contribute 3 percent to total sales, and the “digital other” area 5.1 percent.

These items include income from platforms such as Facebook, Tiktok, Roblox or Peloton and video streaming - above all from YouTube.

Sales of CDs have been falling for years and in 2021 still accounted for a market share of 16.3 percent (minus 16.7 percent).

Vinyl sales, on the other hand, are still on the rise.

Sales of records accounted for 6 percent of the total market (plus 20.1 percent).

Overall, sales of 463 million euros were achieved with physical sound carriers (minus 9.1 percent), while revenue from digital media amounted to 1.502 billion euros (plus 17.7 percent).

"The CD continues to lose relevance, but it remains an important format in Germany," sums up Florian Drücke.

“With streaming as a growth driver and the vinyl segment, which is also growing strongly – albeit at a comparatively manageable level – we have a good portfolio of products.

In addition, the labels are also offered more and more opportunities through partnerships and corresponding licensing of new musical usage and experience worlds such as Peloton, Tiktok or Roblox.

Vinyl is growing, but the situation remains difficult

A popular topic in the industry are the so-called "super fans", i.e. music lovers who not only stream and occasionally buy CDs, but are also interested in more expensive fan merchandise.

Boxes with a CD or record as a basis and various accessories are offered for many releases.

Especially limited and specially designed vinyl versions are in great demand.

Many vinyl fans also have a streaming subscription, says Drücke.

"The record is therefore not only relevant as a sound carrier, but also as a coveted fan article and as such a great opportunity, especially for smaller artists".

In addition to the ever-present cost increases for raw materials or energy, the production bottlenecks and the lack of short-term slots are currently a problem for some, says Drücke.

The demand for pressings is currently significantly exceeding the capacities of the pressing plants, and the situation is sometimes extremely problematic, especially for smaller labels.

In the case of German indie labels, physical business often accounts for around 50 percent of sales, Jörg Heidemann, managing director of the “Association of Independent Music Entrepreneurs” (VUT) recently told the FAZ.

You can't blame the giants of the industry for also wanting to take advantage of the run on vinyl: "All labels - whether large or small - know that they generate the most revenue for their artists in percentage terms when they sell physical sound carriers, and the majors just work with much larger volumes.” There are sometimes voices from the industry according to which larger orders from majors are prioritized, which means that small runs from indies fall behind.

A price list from a service provider from mid-January, which is available to the FAZ and in which customers are informed of a surcharge of 14 percent for vinyl productions, gives an impression of the current situation.

The company cites price increases at the press shop as justification.

In addition, the press capacities for vinyl production currently promised for 2022 are fully planned.