That chart shows revenue, so I don’t think it takes into account the higher profit margins that come with not needing to manufacture and distribute physical media.
RIAA income != artist income
I don't understand why buying music on iTunes was so popular in the US for a while, when in Europe everyone was already listening to Spotify.
in Europe everyone was already listening to Spotify.
Spotify wasn't available in the US until almost 2.5 years after its initial launch.
But weren't there other streaming services such as last.fm and pandora?
More disposable income, different culture that values actual possession more then merely enjoying it.
Is that accounting for inflation?
No, the peak statement is not valid if inflation is considered. But the page has a "Adjusted for inflation" checkbox on the right, so you can see for yourself. :)