Spotify and iTunes Radio boost US audio streaming market by 50%

US music tastes are switching from physical downloads to on-demand online streaming with services such as Spotify, Rdio and Pandora seeing an increase of over 50 per cent compared to last year.

Related: Apple snaps up Beats Electronics and Beats music streaming service for $3bn

Nielsen’s US Music Report for the first half of 2014 showed that total on-demand streams rose by 42 per cent to 70.2 billion plays in the first half of the year and in 2013 that number failed to top 50 billion.

It was even better news for audio streaming as it increased from 22.4 billion in 2013 to 33.6 billion in 2014 – a rise of some 50.1 per cent. Digital album sales suffered a fall as a result, units sold dropping 11.6 per cent from 60.8 million in the first half of 2013 to 53.8 million in the first half of 2014.

Video streaming also saw a double-digit percentage point increase of 35.2 per cent to 36.6 billion streams and audio streaming has shown so much growth that sites like Spotify and Pandora are now almost neck-and-neck with YouTube and other sites when it comes to streaming music.

On the physical side of things, CD sales continue a historic downward turn with a drop of 19.6 per cent meaning that 62.9 million units were sold. Vinyl sales, meanwhile, increased 40.4 per cent compared with the same period last year and rose from 2.9 million to 4 million.

The popularity of streaming has been evident for some time and Spotify’s moves in this sector have since been replicated by Apple’s iTunes Radio and Google All Access Music services that are both looking to capitalise on this lucrative sector.

Related: Google bags music streaming and recommendation service Songza

Samsung and Amazon are also investing heavily in similar streaming services and it just goes to show how quickly the move from CDs to downloading to straight out streaming has taken to play out.

Image Credit: Flickr (Bjorn Olsson)