Cross Price Elasticity of Demand - Music Streaming | tutor2u Economics
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Cross Price Elasticity of Demand - Music Streaming Hits Album Sales

The growing popularity of relatively low-priced music streaming from services such as Apple Music and Spotify is coming at the expense of other market segments. This is a good example of cross price elasticity of demand in action. 

Infographic: The Rise of Music Streaming Continues | Statista

You will find more statistics at Statista

Apple music now has in excess of 10 million subscribers and Spotify’s subscriber base is estimated to be 25-30 million with a much larger advert-supported free tier of active users.

A report on the US music industry from Neilson found that Justin Bieber’s album  set an all-time record for total audio on-demand streams when it was streamed more than 100 million times the week of its release.

CD album sales and album downloads last year declined by 11 and 3 percent, respectively, and digital track sales dropped by 12 per cent.

Statistic: Number of paying Spotify subscribers worldwide from July 2010 to June 2015 (in millions) | Statista
Find more statistics at Statista

The vinyl countdown?
The only other format that is rising in popularity is vinyl. The format of analog music lovers continued its comeback in 2015 with a 29 percent increase in LP sales. This is good news for many smaller independent music stores who are the main driver of the recovery in vinyl sales. 

In the UK for example, Vinyl albums share of music albums sales in the United Kingdom (UK) has risen from 0.2% in 2009 to 1.5% in 2014.

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