SoundScan

The push-pull relationship of streaming and albums

Wednesday, November 6, 2013 - 12:15pm

Can streaming music help album sales?

Last week’s SoundScan charted the lowest number of single-week album sales since 1991, when that measurement started informing Billboard charts, and there was immediate apocalyptic talk that streaming killed the album.

Pessimism might be justified when it comes to the album’s product legitimacy in 2013 and beyond. Bob Lefsetz applies his characteristically blunt futurism to the topic in a reaction to weak sales performance of Katy Perry’s new Prism collection.

Streaming music is not the cause of declining album sales, although it does reflect and support changing consumer demands and expectations. Consumer choice has been evolving for 15 years. Whether that marketplace shift is blindingly sudden or laboriously slow depends on whether your clock is set to Internet time or normal-world time.

The album suffered its first collision with digital reality when the mp3 format was unleashed, along with corresponding computer apps that enabled recording CD tracks. The term “ripping” resonated with illegality (“ripping off”), but copying tracks to mp3 files was just a legal as copying them to cassette tape.

It was the widespread sharing of mp3 tracks that was legally problematic. Sharing mix tapes on cassette was illegal, too, but so cumbersome and one-to-one that nobody much cared. When the original Napster hit the net in 1999, a one-to-many file-sharing revolution occurred. Horrified record labels complained that they couldn’t compete with free music, an obvious though arguable point, but two other values made Napster popular: a long tail of music unavailable elsewhere, and tracks separated from albums.

The iTunes Music Store rescued labels by wrapping a commerce solution around some Napster attractions. Doing so demystified and sanctioned single-track consumption. Steve Jobs had to talk the labels into breaking apart their albums for sale, and gave them digital rights management (DRM) in exchange, at least temporarily -- mostly solving the copy problem for iTunes-purchased tracks.

Music as e-commerce was off and running, but the album was a seriously broken product by 2003. A CNN Money article in 2010 reported skidding album sales in nine of the decade’s ten years.

Streaming music was operating in various forms before iTunes Music Store launched, including webcasts (AM/FM and pureplay), eMusic (subscription to download) and Rhapsody (subscription to stream). The combination of all these forces -- unauthorized file-sharing, iTunes price-per-download, subscription jukeboxes -- ushered the playlist era, a mix-your-own-album type of music consumption. Music became increasingly granular, smashed from album boulders into playlist gravel.

The mobile computing revolution, which started with laptops and accelerated with smartphones, furthered the trend. As cell phone data speeds increased in rapid technology cycles, the concept of accessing music from anywhere became viable for an enlarging class of well-equipped consumers.

Something else happened: a new streaming business framework based on advertising unlocked the “celestial jukebox” to people unwilling to pay for a music subscription. Spotify, Rdio, and their ilk offered an easy, no-charge on ramp to the so-called access model, where music exists as an always-on cloud of content available anywhere, synchronized across personal technology devices.

More than just granular, music has become atomized. The musicians’ complaint is that atoms of music consumption don’t pay as well as selling the big rocks (albums) or little rocks (price-per-track). The streaming industry’s response is that the liquification of music is still in early days, and when streams become tidal, everyone will prosper.

Recent experiments in iTunes Radio indicate that streaming access can stimulate old-world music purchase habits. iTunes Radio streamed Eminem’s new album for week before its release as a download or disc. The service did something similar with Justin Timberlake’s latest release; we noted then that “album release date” had taken a new, more liquid definition. We also noted that Timberlake’s album was perched atop the iTunes Store album-sales chart, while its individual tracks were far down the singles chart.

Whether streaming is driving album purchases is difficult to determine, but there does appear to be correlation of iTunes Radio pre-release streaming and iTunes Store chart performance. The Eminem experiment seems to be producing the same effect. The album’s pre-sales have propelled it to the #1 chart position. At the same time (either connected to pre-release streaming or not), Billboard reports that the Eminem album will start its Billboard 200 life in the top slot, and notch the second-highest album-sales week of the year.

So, while general music streaming might not support album sales, targeted promotional streaming on a major platform might funnel users who still enjoy outright ownership into traditional music stores. Especially when, as with Apple, the streaming service sits side-by-side with the music store.

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