German music industry association, BVMI, and chart compiler GFK announced preliminary 2014 year-end results for the German music market. The overall market was valued around €1.48 billion, up 1.8% from 2013. Physical sales of CDs and records were down 1% in 2014, down from €1,452 million in 2013 to €1,437 million in 2014. Digital music grew by more than 12%, up from €328 million in 2013 to €367 million in 2014.
The German music market continues to see steady revenues as total market value in 2014 increased 1.8% from 2013. The music market experienced 1.2% growth from 2012-2013, recovering from five years of decline.
While physical still accounts for the majority of the market value, around 75%, digital has contributed to growth in recent years. From 2009-2012, digital music revenues saw an average increase of 19% slowing to 11% in 2013 and 12% in 2014. Slowed growth is likely a result from services like Deezer and Spotify, launched in 2011 and 2012, respectively, maturing in the market. Digital streaming revenue grew 88% from €36 million in 2012 to 2013 to €68 million. While final data won’t be released until March 2014, streaming growth is expected to increase, according to IHS.
Digital growth is slowing but more interesting is Germany’s physical market. Physical sale of music is declining more rapidly in markets like the UK with a 7.9% decline from 2013. However, Germany’s physical decline has been steadier, decreasing on average 4% per year since 2010 and only 1% in 2013 and 2014. While streaming revenue is experiencing a rapid increase, physical media still maintains over three-fourths of music market revenue.