Neilsen Says TuneCore is responsible for ~100% of the music releases in 2009 (and oh yeah, we are a major record label)

Well here's some interesting news.  An article just ran on CNN.com Titled "The Plan To Save The Music Biz".
In this article were statistics provided by Neilsen.

According to Nielsen (self defined as "...the world’s leading marketing and media information company.")  there were:

"...106,000 new (music) releases in 2008"

In 2009, TuneCore released approximately 90,000 releases

This means, if their numbers hold true, almost every single new music release in 2009 was distributed via TuneCore.

In addition, the article went on to quote the following Neilsen statistic

"Of the 63 new releases that sold more than 250,000 copies last year, 61 were issued by major music companies."

Well then, according to Neilsen, there are now four major "music companies"  - Sony, Warner, EMI and, according to Neilsen, TuneCore as all of the following TuneCore artists sold over 250,000 copies....and mind you, this is a not a complete list:

Nevershoutnever
Jon Lajoie
Ron Pope
Nickasuar
Boyce Avenue
Kelly
Jesus Culture
Colt Ford
Harry and The Potters
William Fitzsimmons
Millionaires

Well, here's my two cents on Neilsen...

In 1991, Soundscan launched and shook up the music industry by electronically tracking and reporting weekly music sales based on information reported to it from music retail stores across the country.

The once a week Soundscan sales reports displayed how a record sold over the last week and literally made or doomed a release.  Labels, managers and artists used the data to leverage MTV, commercial radio, get more record into retail stores, justify marketing and tour budgets, get gigs, create other marketing opportunities or alternately decide that a record was “dead.”

Although Soundscan tracked single, EP and album sales, it was album sales that were the most important as, since the early sixties, it was an album-buying world. The album ruled, not only in the way music fans bought music, but also in regards to profit margins.

Being on the top of the Soundcan created Billboard Top 40 charts meant money, heavy rotation on MTV, the cover of Rolling Stone, opportunity and being able to flip on a radio station anywhere in the country and hear the same song played relentlessly.  The whole thing would spin up into a frenzy selling more, making more money, getting more radio and MTV play, creating more fans, selling more, making more money, getting more play etc etc until it would burn out and the next one came along.  Being on the Billboard Top 40 was “IT”, the beginning and the end of what it was all about.  Since its launch in 1991, the sales numbers from Soundscan were exclusively used to make these charts.

And what a great position for Soundscan to be in – to be the ONLY entity in the country that collected, tracked and reported on “IT”. With no competition, anyone that wanted access to this information had to pay Soundscan a price Soundscan dictated. In an almost perverse twist, labels were paying Soundscan millions of dollars a year for access to their own information.

But the days of the Top 40 charts are coming to an end. Music buyers now predominantly buy songs across an artist’s catalog, not just from one album. Artists can also become extremely famous and make significant amounts of money from their fame in ways that are not tracked or tied into music sales. MTV rarely plays videos, commercial radio’s impact and penetration, thought still significant, is declining, blogs can break bands and needing to convince the retail store to “stock” music is no longer an issue in a world of unlimited digital shelf space and inventory. No matter what Soundscan states, I can empirically tell you its sales data and the Billboard charts no longer accurately rank “IT”.

TuneCore Arists like Nevershoutnever, Boyce Avenue, Secondhand Serenade, Kelly, Harry & The Potters,  Jesus Culture, and Colt Ford literally sell hundreds of thousands of songs spread over multiple EPs, full length albums and singles.   Should a band that sells 500,000 songs in one month spread across multiple releases be thought of as less successful than a band that sells 50,000 copies of an album in one month?  What about gig and merchandise income?  According to Soundscan, Bruce Springsteen and U2 are not “best selling” artists (they categorize them as “catalog”), yet in one night, they generate more revenue than many of the current Top 40 artists. And the new fad right now for labels is the “360 deal” where the label generates revenue from things outside of album sales.

And what about the arbitrary concept of looking at a weeks worth of sales, why not a days, or a months, or a years?  Things are moving much faster. More music is being recorded and released. Music buyers are moving faster too.  Seems to me that the age-old concept of weekly album sales has lost its relevancy.

It’s time to get a new system that more accurately reflects the new “IT” – and this time, its important not to consolidate the power of the reporting into the hands of one company.

Comments

[WoodsSelma]

Do you understand that it's high time to get the home loans, which can help you.

[Adam D.]

I just want to say that I have been awfully critical of Jeff's intentions in posting this blog, given the big picture. The devil is in the details. However, Tune Core is a valued service that provides at a low cost to the artist an opportunity to distribute his/her music internationally, with 100% of the rights.

I know many EXTREMELY successful artists who refuse record contracts because of the terms, leave major labels in the hopes of indie futures or operate their performance career in the red. I looked into CD Baby. I prefer Tune Core. Personally, I can say that I would be frustrated professionally if the Tune Core service were to disappear.

Since reading another post on this blog, I have developed some metrics for my music business chops. Grown my MySpace network nearly 300% in less than a month, stepped up my bulletins and blogs to advertise my latest releases, as well as direct mail, and inched my way toward the Top 20 in the Daily Downloads section on All About Jazz, etc. Promotions are up to the artist. YOU have to find a way to make your music sell, impressive gigs and spades of raw talent aside.

I challenge anybody to post a feasible business proposal to the average Tune Core user who will prefer said proposal over this service, personal business responsibilities aside. The idea that you can distribute an album, sit back and watch the millions roll in is preposterous.

Although, I would argue to anybody who said artistic value is the primary determinant of your success that they are simply naive. And this seems sadly unjust.

The problem of how to make money in a competitive industry where many variables, not to mention luck contribute to commercial success is to complex for tongue-in-cheek self-aggrandizing, awkward over-simplifications.

[Jeff Price]

IN RESPONSE TO RICHARD:

My initial instinct was to get angry at at Richard and bite back hard. But I took a moment to remind myself the way it has been for the past fifty years, how artists have been screwed and taken advantage of time and time again. How many companies have literally taken advantage of artists with promises of fame and fortune to simply squeeze a buck out of them.

Sadly, although he is wrong, I can understand where he is coming from. To Richard all I can say is things are changing. Not every teacher, instructor, music college, music gear store or distributor - all entities that provide a service to a musician for an up-front flat fee - are evil. Some truly want to make the world a better place and help.

The goal of TuneCore is to provide choice, information and education, never take rights, never make money off the success of a musician but help the musician succeed.

Help a musician get thier music where they want it to go. We don't promise fame and fortune, we do promise to provide a service for a fee, not take rights, not make money off the sales and we will live up to our obligation and do what we say we will do the way we say we will do it.

If you create music and prefer not to have it distributed, there is nothing wrong with that.

But there are some good people out there in the world that truly are making the world a better place for musicians.

[Richard Dianne]

Tunecore, hmmm, genius don't think so... Lucky yes, just a clearing house for the dreams of artists, and Job's iTunes who don't want to be bothered with masses; hopefully for Tunecore, it gets bought soon, don't suspect it will be around in the long-term as artists realize that there are better ways to get their music out there instead of playing the lottery with Tunecore. Next venture for Price and founders- check cashing outlets.....

[Adam D.]

I took some time to consider Soundscan's reason to track album sales, instead of sales across a catalogue. I think I have the answer. Album sales measure innovation and, in terms of "breaking," the strength of the "wave." Tell you what I mean.

In terms of the moment, album sales measure the primacy. And in terms of the product, the centrality of the artist and his ability to generate a focused wave of consumer attention. In one word, "Innovation." (Yes, marketing innovation, too.)

Selling across a catalogue is connotative of artists who have been around a while. Whether true or false, the cliche about these artists is that they have stopped innovating. That is the perception of the public. That's just the way it is. Although this might be a fabrication of the industry, it is not just Soundscan, but major labels, the free press (the very machines of industry) AND consumers dictating Soundscan's terms. The fact that 14 or even 100 artists sell across a catalogue doesn't disprove that, even if you think they ARE innovative. In that sense, the premise for how Neilsen collects statistics is correct.

[Jack Kashmir]

I have a few improvements that Tunecore could implement to help the "independent" artists.
1. It would be nice to be able to add artwork and page layout to our iTunes albums (like signed artists have) instead of just an album cover and song list.
2. Better promotional options: For Ex: Last.fm pays $0.007 per listen(you read that right - every time someone scrobbles a song the artist receives 7 one thousands of a penny). Last.fm charges $0.25 per play to get music to the listener - very unbalanced. Tunecore should strike a deal with Last.fm to get a realistic per/play ad campaign (in the neighborhood of $0.05-0.10 per play - the lower the better)
3. Automatic transfer of the album to Last.fm account (currently artists have to upload it themselves)
4. Start Tunecore shoutcast servers. Shoutcast stations are popular and I'm sure many artists would be willing to add an advert campaign on Tunecore sponsored shoutcast servers.
5. Integration with youtube. Automatic registration of the artist and album with youtube so we can post videos that automatically have purchase links on them for our music.

These are pretty good ideas - Tunecore should give this some serious consideration.

Have a good one.

[Stevie L. Daniel]

Radio started out as way of basically advertising artists and thier music. Nowadays, you hear the music but very rarely do radio stations state who the artist is. Usually a set of music is played and then thay will either go to commercial, the news or go into a conversation about... whatever, but it's very seldom thay will state the name of the songs that were played, not to mention stating who the artists were. Has radio lost what it;s original purpose was?

[IHipHopdotcom]

Soundscan is dead and its about time someone raised this issue. Kudos

[Jim Moeller]

Band analytics - from companies like Next Big Sound and Band Metrics - will be the future of what artists and managers use to track progress.

[Vitaly Franco]

Very interesting article jeff!
thanks a lot.
I dont know why people wen on attacking Jeff for "trying to promote" something that wasnt the point at all.
From my point of view, he was just trying us to acknowledge the fact that "the biggest, strongest, more reliable and ONLY music information company" is overlooking new means from which people are consuming music nowadays.
And I do think you make a strong point there.
People, you don´t have to complicate things so much over the stats he present, just the first one is enough to support the point he´s trying to make.
technology has created a lot of alternative surfaces to distribute good music, that shouldnt be overlooked by the information companies that guide the mass´decision to spend money in music. either is for tv, films, campaigns of all kinds, you name it.
keep it up jeff, great read.
V

[Adam D.]

Thanks, Jeff. I guess you were answering somebody else's question about Tune Core having a solution to the "problem" you presented. I have other income in the music industry and in other professional artistic endeavors, i.e. Design, so that I have no distress about what opportunities the industry provides. Maybe you answered your own question. I fully support you in your effort to raise consciousness about the reality of the Neilsen ratings system. Matter of fact, no need to come off "with all due respect," as I read my comment as I intended it to be read, which pretty clearly puts it in the context of Neilsen's criteria, not my own. I release music on Tune Core, Jeff! I do NOT feel "de-legitimized" by how Neilsen collects its statistics, with all due respect. The best thing you can do is to discover WHY Neilsen goes about collecting statistics in this way, and then decide whether that premise is absurd. Strategically, you stand a better chance of proving a point if you have a target than you do writing a cheeky article. All that I would suggest is to perhaps try a more direct approach. Although (and not to de-legitimize you), the so-called Zeitgeist has more to do with what resonates with listeners than what qualifies as Art. (How many records do John McLaughlin or Return To Forever sell these days?) Sadly, the heyday of many of the truly great recordings available today has passed. And so too has the support for some of those styles of music. RE: The Zeitgeist, it's tough to make the choice to fit into a format, and then get your song done the way you need to to be heard. I hold no animus toward Neilsen or top 40 artists, notwithstanding the failure of some of those releases (perhaps artistic AND commercial) to be included in the Neilsen ratings system. You see, Neilsen doesn't say a release is a success or a flop . . . commercially . . . artistically . . . Neilsen simply has a misrepresentative way of collecting and presenting data. While I appreciate the seriousness of that, it is not how I define myself. Nor my own artistic worth vis-a-vis the commercial success of fellow Tune Core artists. DO believe those artists deserve an proportional piece of the media pie, tho. And DO wish all the best. And I do admire your passion for letting the truth be heard. On THAT front, I hope Tune Core can provide a service to artists whose sales deserve recognition in the media (assuming they ARE attention starved). In any case, keep fighting the good fight!

[JeffCore]

and that link should work now - if not it's located here

http://money.cnn.com/2010/01/11/news/companies/am_octone_music.fortune/?section=magazines_fortune

[JeffCore]

And to Adam as well

The headline of this article was meant to be sarcastic.
There is no way TuneCore is responsible for 100% of the releases in 2009 -by stating this I am attempting to show how wrong Neilsen's stats are.

I thought I had done a good job doing that (and tried to drive it home with the "oh yeah, we are a major record label!) - as we are not a major record label

Man, getting sarcasm to shine through is harder for me than I thought!

[JeffCore]

The reason I posted this blog posting is out of frustration with Neisen, and the media, misrepresenting the truth.

Based on Neilsen's statements - taken as the only source of information by the media as true - if an artists' release is not counted by Neilsen than it is not actually released - you have, in effect, been de-legitimized,

With all due respect, I dont believe an artist's release should not "count" if not recognized by Neilsen as this closes off possible opportunities based on the perception that your release is not "real"

I also find it distressing that the media, and other outlets, turn to Neilsen as the definitive source to determine what is occurring in this industry thereby decreasing the opportunities for musicians and artists that are not part of this old school system.

The reality is the majority of music is now being created, released and sold outside of the traditional system. Ad agencies, music supervisors, video game manufacturers, radio programmers etc turn to Neilsen for information to discover music in an attempt to use/license it. They need to understand that the Neilsen information is an incomplete and an inaccurate portrayal of reality. This inaccurate perception is holding back opportunity and validation for others.

So yes, I want the world to know the truth, I want fans and businesses to understand that this information being touted as the end all be all is actually extremely inaccurate and I intend to broadcast the truth as loudly as possible to as many people as possible.

It is TuneCore's job to provide opportunities, access, knowledge and information, I will use every outlet I have to make certain there is truth in the marketplace - based not on my, or someone else's opinion, but based on hard empirical data.

And to that end, and to answer your question, yes, TuneCore is working on creating a solution to correct this problem.

[Matt Shamus]

Link to the CNN article is broken...