Billboard Factors In Streaming And Downloaded Music Into Top 200 Chart: What Does It Mean For The Music Biz?

Last Thursday marked Billboard’s biggest innovation since it began to use Nielsen’s point-of-sale data system, SoundScan, in 1991 to measure album sales. When it released its latest list of the 200 top-selling albums, the rankings included -- for the first time -- how many times songs had been streamed or downloaded, reported Marketplace. The conversion metric Billboard used counts 10 digital-track sales or 1,500 song streams as one album.

But why is Billboard, the bible of the music business, still counting "albums" as a key measure of music sales? Didn't that ship sail years ago? Who does it benefit -- new or old-school artists?

Charting album sales is anachronistic, argues analyst and critic Bob Lefsetz, who believes that the conversion of track sales and streams, by still holding the album as the standard, doesn’t reflect the reality of how music is actually listened to. Because album sales are tanking, he argued in a blog post, “The only thing that counts is listens. Sales are irrelevant. Especially of albums. ... Streams only. They represent what people are listening to.”

Paul Verna, senior analyst for eMarketer and a veteran of the music industry, welcomed the inclusion of the new data -- even if it might be a couple years too late. In the same way that SoundScan gave exposure of hip-hop artists, for example, to a wider audience for the first time by showing consumers what music was actually being bought (as opposed to what labels had pressured retailers to say was being bought), bands that don’t sell a lot of albums but do well online will get their name out there.

“The music biz has been so complex and fragmented even as recently as 10 years ago," Verna said. “For most artists, sales account for more business than streams. There may come a day when sales are a small part of the equation,” he said, “but even then, why not count them?” Verna believes it’s too early to stop tracking album sales altogether.

According to the Recording Industry Association of America, streaming music accounted for 27 percent of revenue for the music industry in the first half of 2014, while album sales dropped by 14 percent and downloads by 12 percent.

“Album sales metrics don’t capture all activity because music has become atomized," said Casey Rae, of the Future of Music Coalition. Regarding Billboard's new data, he said, "The industry needed to know where the action was. The new system is harder to game. There’s a random element of virality, and it’s consumer- and audience-driven.”

In that atomized world of music that Billboard doesn't yet reflect are sites like BandCamp, which allows artists to upload and share music, with the option for consumers to purchase an album or track with a flexible pricing structure. "Discover amazing new music and directly support the artists who make it" is their motto.

"Bandcamp isn’t part of the traditional music industry," said Rae, "and includes indie artists you won’t see on Billboard charts. There are no major labels featured there, and while artists can set the price for their music, fans can pay more."

Although the new charts provide greater insight into the level of consumer interaction with music, streaming services like Spotify, for example, may track how many times a song is listened to, but it doesn’t track how long people are sitting with a whole album. To provide an example, Rae said that his daughter may listen to “Let It Go” enough times to account for 60 album sales, but the information doesn’t say a whole lot about how the whole album is engaged with. “It’s a work in progress,” he says of the chart metrics.

“We’ve acknowledged that album sales are declining and there are other ways people are consuming music,” said Silvio Pietroluongo, director of charts for Billboard. “But who’s to say that in five to 10 years streaming will be around? We’re trying to go where the consumer is and reflect their behavior.”

He added, "It’s comforting to artists to know how their work is being accessed. Having streaming might help some artists. There are a few who don't put their titles up on streaming services. But not having streaming won’t hurt people like Taylor Swift."

When International Business Times asked Pietroluongo what his reaction was to critics such as Lefsetz who think album sales shouldn’t be counted anymore, he responded, “You don’t throw the baby out with the bathwater. The album is still viable -- the physical album and the downloadable album.”

He added, “Tell Taylor Swift album sales don’t matter.”

He’s referring, of course, to Swift’s recent album, "1989," which was the first in 2014 to go platinum, even after she yanked her music catalog from Spotify. (Speaking of metrics, Spotify released its own most-listened-to list, which didn’t include Swift.)

The new charts, Pietroluongo said, “are acknowledging how consumers are exposed to music. They have so many options: the ability to get anything they like on any device, at any venue. It's a great era for music lovers."