RIAA’s Strategic Shift: Why the Music Industry’s Revenue Reporting Changed from Retail to Wholesale
The Recording Industry Association of America (RIAA) made a significant and largely unannounced change to its revenue reporting methodology in 2025, switching from retail to wholesale figures after decades of using consumer-facing retail values. This shift represents more than just an accounting adjustment it fundamentally alters how the music industry’s financial health is perceived and measured.
The Methodology Change Explained
For nearly five decades, the RIAA reported music industry revenues at retail values, which reflect the full price consumers pay at checkout, including markups from retailers, taxes, and all distribution costs. These retail figures became the industry’s benchmark for success, with iconic milestones like the $14.6 billion peak in 1999 during the CD era and the devastating decline to $6.7 billion in 2014 serving as shorthand for the industry’s health.
Beginning with its mid-year 2025 report, the RIAA now presents all revenue metrics exclusively at wholesale values the actual amounts that record labels and rights holders receive after retailers, streaming platforms, and other intermediaries take their cuts. This wholesale approach excludes consumer markups, taxes, and the shares paid to digital service providers like Spotify or Apple Music.
The difference is substantial: while the RIAA reported $8.7 billion in retail revenue for the first half of 2024, the equivalent wholesale figure was only $5.5 billion. For the first half of 2025, wholesale revenue reached $5.6 billion a figure that appears impressive until compared to what retail numbers would have been.
Alignment with Global Standards
The RIAA justifies this change as bringing American reporting in line with international standards, particularly the International Federation of the Phonographic Industry (IFPI) Global Music Report. The IFPI has long used wholesale or “trade value” figures, which represent record companies’ actual revenue from sales and licensing to digital service providers and retailers, net of discounts, returns, and taxes.
RIAA VP of Research Matt Bass emphasized this alignment, stating that the shift “enables more consistent cross-market comparisons and highlighting the real dollars that flow back into the creative ecosystem”. This standardization theoretically makes it easier to compare the US market with other territories and understand the actual money flowing to artists, labels, and rights holders.
The Transparency Problem
However, this change comes with significant transparency costs that have drawn criticism from industry observers. The RIAA made this shift without advance notice, and the implications extend far beyond simple number adjustments:
Historical Data Loss: The RIAA’s comprehensive digital database, which contained revenue figures by format dating back to 1974, was removed from its website during the transition. This eliminates decades of historical trend data that researchers, analysts, and industry professionals relied upon for market analysis.
Format-Level Comparisons Eliminated: Previously, the RIAA provided detailed breakdowns of revenue by format—vinyl, CD, streaming, downloads at retail values, enabling year-over-year analysis of consumer behavior and format preferences. Since wholesale breakdowns by format were never historically provided, multi-year trend analysis is now impossible beyond the previous year’s data.
Limited Accessibility: The only alternative source for detailed format-level data is the IFPI’s premium reports, which cost over $20,000 annually, making comprehensive industry analysis inaccessible to smaller researchers and independent analysts.
Impact on Industry Narrative
The methodology change significantly alters the industry’s growth narrative. Retail figures traditionally told a story of consumer engagement and market size, while wholesale figures present a more conservative view focused on actual industry revenues. This shift comes at a time when growth is already slowing the wholesale revenue increase of just 0.9% in the first half of 2025 looks particularly anemic.
The timing raises questions about whether this change aims to manage perceptions during a period of decelerating growth. With streaming subscription growth slowing dramatically from 15.1 million net additions in 2020 to just 3.2 million in 2024—the industry faces challenges in maintaining its growth narrative.
What Wholesale Figures Reveal
Wholesale revenue reporting provides a more accurate picture of the money actually flowing through the music ecosystem. For streaming services, wholesale figures exclude the platforms’ operational costs and profit margins, showing only what reaches rights holders. This includes the complex revenue splits between streaming platforms (typically keeping 15-30%), record labels, distributors, and ultimately artists.
The wholesale methodology also reveals the true economics of physical sales, where manufacturing costs, wholesale markups, and retail markups are stripped away to show actual label revenues. For vinyl, which has seen remarkable growth, wholesale figures demonstrate the actual money reaching labels rather than consumer spending levels.
Industry Implications
This reporting change reflects broader tensions in music industry economics. Publishers, for instance, saw 13.4% revenue growth in 2024 compared to just 2.7% for recorded music wholesale revenues, highlighting how different sectors of the music economy are performing. The wholesale focus may better capture these nuanced revenue flows within the industry ecosystem.
The change also comes as the industry grapples with the “value gap” debate the ongoing discussion about whether streaming platforms and technology intermediaries capture too much value relative to what flows back to music creators. Wholesale reporting provides a clearer view of this dynamic by focusing on actual payments to rights holders.
Looking Forward
The RIAA has indicated that it will restore its historical database with wholesale figures when it releases full-year 2025 data in spring 2026. However, the loss of retail-level historical context represents a significant shift in industry transparency and analysis capabilities.
This methodological change ultimately reflects the music industry’s maturation and its desire to present a more professional, internationally aligned view of its economics. While wholesale figures provide greater accuracy about actual industry revenues, they also reduce the transparency and historical continuity that have long served industry analysis. The shift signals an industry increasingly focused on demonstrating real value creation rather than consumer market size a strategic positioning that may serve it well as growth continues to slow and competition for attention intensifies.
For music industry stakeholders, this change necessitates a fundamental recalibration of how success and trends are measured, moving from consumer-focused metrics to industry-revenue focused analysis. Whether this serves the broader interests of transparency and public understanding remains an open question as the industry adapts to this new reporting reality.
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