Connect with us

Markets

Visualizing 40 Years of Music Industry Sales

Published

on

Visualizing 40 Years of Music Industry Sales

40 Years of Music Industry Sales

The record industry has seen a lot of change over the years.

8-tracks took a short-lived run at the dominance of vinyl, cassettes faded away as compact discs took the world by storm, and through it all, the music industry saw its revenue continue to climb. That is, until it was digitally disrupted.

Looking back at four decades of U.S. music industry sales data is a fascinating exercise as it charts not only the rise and fall the record company profits, but seismic shifts in technology and consumer behavior as well.

The Long Fade Out

For people of a certain age group, early memories of acquiring new music are inexorably linked to piracy. Going to the store and purchasing a $20 disc wasn’t even a part of the thought process. Napster, the first widely used P2P service, figuratively skipped the needle off the record and ended years of impressive profitability in the recording industry.

Physical vs. Digital sales

Napster was shut down in 2002, but the genie was already out of the bottle. Piracy’s effect on the industry was immediate and stark. Music industry sales, which had been experiencing impressive year-over-year growth, began a decline that would continue for 15 years.

The Ringtone Era

While acquiring music was as easy opening Limewire on your desktop computer, transferring that new T-Pain track to a flip-phone wasn’t a seamless experience.

This brief gap in technology – before smartphones hit mass adoption – brought us the ringtone era. Distribution was controlled by mobile carriers, so ringtones were a comfortable gateway for the record industry to get a taste for digital-based revenue. In 2008 alone, they injected over a billion dollars of revenue into an industry that was getting used to gloomy forecasts.

Paddling Upstream

Though services like Spotify and Pandora haven’t replaced the money pipeline that CD sales provided, they have reversed the industry’s tailspin. For the first time this millennium, record industry posted an increase in revenue for two consecutive years (and likely a third in 2018).

It took a while for consumers to warm up to paying for a premium music subscription, but today, there’s a solid basis for optimism. Music streaming is now the most common format for music in the United States, and the RIAA reports that streaming now makes up nearly half of the market.

Music Streaming Subscriptions

The End of Physical Format?

Gone are the days when people would line up at the music shop for a hot new release. In fact, CD sales are down 80% in the past decade. Today, physical format sales only account for 17% of the industry’s revenue.

There is, however, one bright spot in physical format segment: vinyl. In 2017, vinyl sales hit 25-year high after making a slow and steady comeback.

Vinyl is written in stone. I think if it’s made it for 120 years now, it’s here forever.

– Jack White

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading
Comments

Markets

The World’s 20 Most Profitable Companies

Saudi Aramco, the state oil producer in Saudi Arabia, rakes in $304 million of profit per day – putting it atop the list of the world’s most profitable companies.

Published

on

The World’s 20 Most Profitable Companies

The biggest chunk of the earnings pie is increasingly split by fewer and fewer companies.

In the U.S. for example, about 50% of all profit generated by public companies goes to just 30 companies — back in 1975, it took 109 companies to accomplish the same feat:

YearNumber of Firms Generating 50% of EarningsTotal Public Companies (U.S.)Portion (%)
19751094,8192.2%
2015303,7660.8%

This power-law dynamic also manifests itself at a global level — and perhaps it’s little surprise that the world’s most profitable companies generate mind-bending returns that would make any accountant blush.

Which Company Makes the Most Per Day?

Today’s infographic comes to us from HowMuch.net, and it uses data from Fortune to illustrate how much profit top global companies actually rake in on a daily basis.

The 20 most profitable companies in the world are listed below in order, and we’ve also broken the same data down per second:

RankCompanyCountryProfit per DayProfit Per Second
#1Saudi Aramco🇸🇦 Saudi Arabia$304,039,726$3,519
#2Apple🇺🇸 United States$163,098,630$1,888
#3Industrial & Commercial Bank of China🇨🇳 China$123,293,973$1,427
#4Samsung Electronics🇰🇷 South Korea$109,301,918$1,265
#5China Construction Bank🇨🇳 China$105,475,068$1,221
#6JPMorgan Chase & Co.🇺🇸 United States$88,969,863$1,030
#7Alphabet🇺🇸 United States$84,208,219$975
#8Agricultural Bank of China🇨🇳 China$83,990,411$972
#9Bank of America Corp.🇺🇸 United States$77,115,068$893
#10Bank of China🇨🇳 China$74,589,589$863
#11Royal Dutch Shell🇬🇧 🇳🇱 UK/Netherlands$63,978,082$740
#12Gazprom🇷🇺 Russia$63,559,178$736
#13Wells Fargo🇺🇸 United States$61,350,685$710
#14Facebook🇺🇸 United States$60,580,822$701
#15Intel🇺🇸 United States$57,679,452$668
#16Exxon Mobil🇺🇸 United States$57,095,890$661
#17AT&T🇺🇸 United States$53,068,493$614
#18Citigroup🇺🇸 United States$49,438,356$572
#19Toyota Motor🇯🇵 Japan$46,526,027$538
#20China Development Bank🇨🇳 China$45,874,795$531

The Saudi Arabian Oil Company, known to most as Saudi Aramco, is by far the world’s most profitable company, raking in a stunning $304 million of profits every day. When translated to a more micro scale, that works out to $3,519 per second.

You’ve likely seen Saudi Aramco in the news lately, though for other reasons.

The giant state-owned company has been rearing to go public at an aggressive $2 trillion valuation, but it’s since delayed that IPO multiple times, most recently stating the listing will take place in December 2019 or January 2020. Company-owned refineries were also the subject of drone attacks last month, which took offline 5.7 million bpd of oil production temporarily.

Despite these challenges, Saudi Aramco still stands pretty tall — after all, such blows are softened when you churn out the same amount of profit as Apple, Alphabet, and Facebook combined.

Numbers on an Annual Basis

Bringing in over $300 million per day of profit is pretty hard to comprehend, but the numbers are even more unfathomable when they are annualized.

RankCompanyCountryProfit
#1Saudi Aramco🇸🇦 Saudi Arabia$110,974,500,000
#2Apple🇺🇸 United States$59,531,000,000
#3Industrial & Commercial Bank of China🇨🇳 China$45,002,300,000
#4Samsung Electronics🇰🇷 South Korea$39,895,200,000
#5China Construction Bank🇨🇳 China$38,498,400,000
#6JPMorgan Chase & Co.🇺🇸 United States$32,474,000,000
#7Alphabet🇺🇸 United States$30,736,000,000
#8Agricultural Bank of China🇨🇳 China$30,656,500,000
#9Bank of America Corp.🇺🇸 United States$28,147,000,000
#10Bank of China🇨🇳 China$27,225,200,000
#11Royal Dutch Shell🇬🇧 🇳🇱 UK/Netherlands$23,352,000,000
#12Gazprom🇷🇺 Russia$23,199,100,000
#13Wells Fargo🇺🇸 United States$22,393,000,000
#14Facebook🇺🇸 United States$22,112,000,000
#15Intel🇺🇸 United States$21,053,000,000
#16Exxon Mobil🇺🇸 United States$20,840,000,000
#17AT&T🇺🇸 United States$19,370,000,000
#18Citigroup🇺🇸 United States$18,045,000,000
#19Toyota Motor🇯🇵 Japan$16,982,000,000
#20China Development Bank🇨🇳 China$16,744,300,000

On an annual basis, Saudi Aramco is raking in $111 billion of profit per year, and that’s with oil prices sitting in the $50-$70 per barrel range.

To put this number in perspective, take a look at Chevron. The American oil giant is one of the 20 biggest companies on the S&P 500, but it generated just $15 billion in profit in 2018 and currently sits at a $221 billion market capitalization.

That puts Chevron’s profits at roughly 10% of Aramco’s — and if Aramco does IPO at a $2 trillion valuation, that would put Chevron at roughly 10% of its market cap, as well.

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading

Cities

Mapped: The World’s Top 10 Cities in 2035

Cities are heavy hitters in the global economy. Where will the top 10 cities be in 2035—based on GDP, population, and annual growth?

Published

on

Mapped: Where Will The Top 10 Cities Be in 2035?

Cities are the engines of the modern economy. Over half of the world now lives in urban areas, and urbanization continues to shape the trajectory of global growth in unprecedented ways.

However, the most important cities of today may be quite different than those leading the charge in the future. This week’s chart looks forward to 2035, using a report by Oxford Economics to forecast the top 10 cities by measures of economic size, population, and GDP growth rate.

Each map is categorized by one of these metrics—and depending on which one you look at, the leaders vary greatly.

Top 10 Cities by Projected GDP

The top 10 cities by gross domestic product (GDP) in 2035 will be fairly widespread. Three cities are expected to be in the U.S.—New York, Los Angeles, and Chicago. The Big Apple’s forecasted $2.5 trillion GDP likely stems from its strong banking and finance sectors.

RankCityCountry2035 GDP
#1New York🇺🇸 United States$2.5T
#2Tokyo🇯🇵 Japan$1.9T
#3Los Angeles🇺🇸 United States$1.5T
#4London🇬🇧 United Kingdom$1.3T
#5Shanghai🇨🇳 China$1.3T
#6Beijing🇨🇳 China$1.1T
#7Paris🇫🇷 France$1.1T
#8Chicago🇺🇸 United States$1.0T
#9Guangzhou🇨🇳 China$0.9T
#10Shenzhen🇨🇳 China$0.9T

Four cities will be found in China, while London, Paris, and Tokyo are set to round out the last three. Interestingly, Tokyo is the #1 city today, with an estimated $1.6 trillion GDP in 2019.

Altogether, these top 10 cities will contribute an impressive $13.5 trillion in GDP by 2035. Clusters of such metropolitan areas are typically considered megaregions—which account for a large share of global economic activity.

Top 10 Cities by Future Population

Next, it’s clear that top cities by population will follow a distinct global distribution. By 2035, the most highly-populated cities will shift towards the East, with seven cities located in Asia.

RankCityCountry2035 Population
#1Jakarta🇮🇩 Indonesia38 million
#2Tokyo🇯🇵 Japan37.8 million
#3Chongqing🇨🇳 China32.2 million
#4Dhaka🇧🇩 Bangladesh31.2 million
#5Shanghai🇨🇳 China25.3 million
#6Karachi🇵🇰 Pakistan24.8 million
#7Kinshasa🇨🇩 DR Congo24.7 million
#8Lagos🇳🇬 Nigeria24.2 million
#9Mexico City🇲🇽 Mexico23.5 million
#10Mumbai🇮🇳 India23.1 million

While Jakarta’s 38 million-strong population is expected to emerge in first place, the city may not retain its status as Indonesia’s capital for much longer. Rising sea levels and poor water infrastructure management mean that Jakarta is rapidly sinking—and the government now plans to pivot the capital to Borneo island.

On the African continent, Kinshasa and Lagos are already among the world’s largest megacities (home to over 10 million people), and will hold top spots by the turn of the century.

Population and demographics can be major assets to a country’s growth. For example, India’s burgeoning working-age demographics will present a unique advantage—and the country is projected to contain several of the fastest growing cities in the coming years.

Top 10 Cities By Estimated Annual GDP Growth

When comparing cities based on their pace of economic growth, there are some clear standouts. Average annual GDP growth across cities is 2.6%, but the top 10 surpass this by a fair amount.

The kicker? All of 2035’s major players will be found in Asia: four of the fastest-growing cities will be in mainland China, another four in India, and the last two in Southeast Asia.

RankCityCountryAnnual Growth
#1Bengaluru🇮🇳 India8.5%
#2Dhaka🇧🇩 Bangladesh7.6%
#3Mumbai🇮🇳 India6.6%
#4Delhi🇮🇳 India6.5%
#5Shenzhen🇨🇳 China5.3%
#6Jakarta🇮🇩 Indonesia5.2%
#7Manila🇵🇭 Philippines5.2%
#8Tianjin🇨🇳 China5.1%
#9Shanghai🇨🇳 China5.0%
#10Chongqing🇨🇳 China4.9%

At #1 by 2035 is Bangalore with an expected 8.5% annual growth forecast—its high-quality talent pool makes the city a breeding ground for tech startups. Jakarta makes another appearance, with its projected 5.2% growth at double the city average.

Shanghai finds its way onto all three lists. The commercial capital hosts the world’s busiest port, and one of China’s two major stock exchanges. These sectors could help boost Shanghai’s annual GDP growth to 5% in 2035.

Looking to the Future

Of course, any number of variables could impact these 2035 projections, from financial recessions and political uncertainty, to rapid urbanization and technological advances.

But one thing’s certain—in the coming decades, cities are where many of these factors will converge and play out.

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading
Standard Lithium Company Spotlight

Subscribe

Join the 130,000+ subscribers who receive our daily email

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Popular