The revenue chart is worthless when it comes to showing demand for music. In fact it just demonstrates the music industry's rent seeking.

They managed to maximize their revenue when they had sole control of distribution. For most musical acts an "album" is one or two singles with a bunch of filler. Anyone wanting to buy those one or two singles had to spend $8-15 on a cassette or CD.

When iTunes et al came around making single sales widely available, we get to see how little most people cared for albums. Before iTunes most labels didn't even sell singles and when they did they were still several dollars vs the 99¢ from iTunes and the like.

Allowing consumers to actually buy what they want has been a huge improvement for them.

This only measures revenues. Are people listening to more, less or the same amount (quantity, diversity, songs, albums, etc) of music?

Listener behaviors have changed, to only cite revenue for the industry (already a subset of all music sources) is unscientific. Video killed something, what killed video and why?

I am going to go out on a limb here and conjecture that the vast majority of people do not listen to music, or listen to much less music than in the past, same thing goes for books. Both industries make the majority of their profits off a small and shrinking segment of the population.

Hit singles are cheap, easy and plentiful to source from anywhere, both paid and free. If the industry just makes hits, they won't have the breadth to support a diverse revenue base. You can't survive on icing alone.

Causation is not established by that chart, I suspect some of the decline was due to piracy, but with no evidence it seems like it could be attributed to other factors. For example there's a drop in vinyl in the late 70's on the chart, at which time napster wasn't a thing.

Late 70s would be the compact cassette rise.