The music industry is shifting to a streaming model from a download model, spurring new high-res streaming services to prepare for launch and more audio hardware companies here at CES to support high-res streaming services.
Retailers at CES will also find a growing selection of car audio products that support various high-res formats, a growing selection of high-res home and portable products supporting studio-quality MQA (Master Quality Authenticated) audio, and more wireless-multiroom speakers supporting high-res playback.
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Attesting to the streaming shift, the RIAA reported that, in the first half of 2017, retail-level music-industry streaming revenues grew 48 percent to $2.5 billion to account for 62 percent of total industry revenues of $3.99 billion. Downloads accounted for only 19 percent of industry revenues in the first half, falling 24 percent during that time to $757 million.
The shift in consumer preference has also had an impact on high-res music downloads. “High-res downloads are holding their own,” said David Chesky, co-founder and CEO of download site HDtracks. “We feel the streaming pinch but nowhere as much as the industry standard.”
MusicWatch statistics also underscore the shift. Seventy percent of the Internet population ages 13 and older streamed music in the past month, or about 156 million streamers, based on Sept. 2017 data, said managing partner Russ Crupnick. That compares to 19 percent of the population that, in 2016, bought at least one music download, or about 42 million people, and they’re listening less to their downloads as “download listeners increasingly substitute streaming,” said Crupnick.
Streams To Come
With the shift, HDtracks plans to launch HDmusicStream, a streaming site featuring MQA-encoded music. It was originally targeted for a late-2016 launch. HDmusicStream will join Tidal, which launched an MQA streaming service in 2017 with titles from the big three music companies and independents. Groovers in Korea was expected to launch MQA streaming before the end of 2017. AndNugs.net, which offers high-res MQA downloads globally, is gearing up for a global MQA streaming launch through iOS and desktop players. In addition, Deezer made an “announcement of intent” to stream MQA in 2018, said MQA inventor MQA Ltd.
In addition, European streaming and download service Qobuz at CES is announcing its 2018 entry into the U.S. market from Europe. It offers more than 40 million CD-quality download titles and 1 million high-res download titles in such formats as FLAC, WAV and DSD. It lays claim to offering more high-res titles for download than any other site in the world. It will also offer 192/24 FLAC streaming in the U.S. at launch. The streaming and download titles will be playable on Mac, PC, iOS, and Android apps and through home audio products from more than 50 brands, a spokesman said.
In 2017, Pandora and Napster also announced intentions to offer high-res streaming, but the projects had not yet come to fruition by the end of the year following management changes.
Currently Tidal’s MQA streams are available through home-audio products from Bluesound, Cary Audio, Lumin, Meridian and NAD, with Esoteric products coming soon, said MQA Ltd. Tidal’s MQA streams are also available through Wi-Fi-equipped DAPs from Pioneer, Onkyo and Astell&Kern as well as through Tidal’s desktop app. Tidal is also testing an iOS app for its MQA service, MQA said. One U.S. smartphone, LG’s V30, already supports MQA streaming and features high-res DACs. An Onkyo-brand smartphone now sold out in Japan also featured MQA.
About 30 brands in all offer or have announced plans to offer MQA products, MQA Ltd. said.
The overall number of products capable of reproducing high-res files of any sort has likewise grown, with more than 80 suppliers globally offering almost 200 different devices released to date, said DEG: The Digital Entertainment Group. That’s up from 65 suppliers and more than 100 high-res products at the end of 2016.
Meanwhile, the amount of high-res music available has grown to more than 40,000 high-res albums globally as of late 2017, most available to U.S. consumers, the FindHDmusic.com database shows. Of that number, thousands of MQA-encoded albums were available to U.S. consumers for download in late 2017 from three online stores — HIGHRESAUDIO, 2L and Onkyo Music — from such labels as Warner Music, RME Premium Recordings, Sono Luminus, Unamas, and 2L, said MQA Ltd. In addition, Nugs.net provides MQA downloads globally of recorded concerts.
High-res music is available through more download sites than ever before, hitting 90 at the end of 2017, most of which are available to U.S. consumers, the FindHDmusic.com database shows. The sites include artist and music-label sites.
Some of the products that play those sites’ tunes will be on display at DEG’s Hi-Res Audio Pavilion at booth 14735 in the Central Hall, where music and services companies will also be represented. The display includes compatible smart phones and the first compatible car from a leading automotive OEM. The booth will also host special presentations, panels of award-winning producer and engineers, and artist guest appearances.
Still A Niche
Despite growing interest and availability, high-res audio is still a niche, said HDtracks’s Chesky. CTA statistics support that assessment. In its mid-2017 forecast, CTA forecast that high-res-capable home-audio receivers would account for 32 percent of 1.32 million receivers sold in 2017 at the factory level. That percentage will slip through 2012 to 28.6 percent of 1.31 million units sold.
Demand for high-res portable digital audio players, or DAPs, is helping reduce the rate of decline in portable media player (PMPs), CTA said.
CTA doesn’t track sales of high-res car audio head units, but at least three suppliers plan to expand their high-res car audio selections at CES. They are Kenwood, JVC and Sony. For their part, neither Pioneer nor Alpine offer high-res heads or plan to introduce them at CES. Clarion has a product but plans no new aftermarket car audio at CES.
Though sales of high-res products might not be growing rapidly in the home, the high-res designation serves a purpose, said Kevin Brannan, director of marketing for Onkyo, Integra and Pioneer home audio products. “It’s definitely a badge of quality,” he said. “The higher end DACs make everything sound better and handle whatever you put through it.” The three brands “are not slowing down” in their support of high-res home audio, and Pioneer and Onkyo will continue to offer high-res DAPs, he added.