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December 16, 2013 9:28 pm
The new album from the singer Beyoncé has become the fastest-selling release in the history of iTunes, reinvigorating Apple’s music store at a time when streaming services such as Spotify, Deezer and Rdio have stolen some of its thunder.
Apple said it sold 828,773 downloads of the album worldwide in its first three days, while the US store’s sales record was broken with 617,213 copies sold. Last year, Taylor Swift’s album Red sold 465,000 copies in the US in its first week, the previous iTunes record.
Apple was able to capitalise on exclusivity – the album will not be made available to other retailers until December 21 – while Sony Music, the singer’s record label, relied entirely on social media buzz to drive sales, rather than spending money on a big marketing campaign.
The launch fits a trend of stars exploring new business models to drive early sales. Daft Punk this summer scored with the release of Random Access Memories, which was also pre-released on iTunes, while Jay-Z – Beyoncé’s husband – gave away 1m copies of his album Magna Carter Holy Grail through a partnership with Samsung.
Mark Mulligan, a music industry analyst with Midia Consulting, said in a blog post that the success of the Beyoncé album highlighted the importance of first week sales.
“As music sales continue to dwindle artists’ release teams have to get increasingly creative about how they get the most bang for their marketing buck,” Mr Mulligan wrote. “Expect the first week sales focus to sharpen even further now for frontline global scale artists.”
The music industry is following the lead of movie studios and video game producers, which concentrate their marketing efforts in the first week their titles are released.
Michael Sukin, a music industry lawyer, said the release of a fixed bundle with limited marketing fanfare could become a trend for other artists to follow. “The record business has finally woken up to the reality of a new market place,” he said.
“I don’t think Beyoncé is the only artist who could do this. Most artists who have had an album or two out have a very big fan base,” Mr Sukin said.
Spotify has recently embarked on a charm offensive to win over top stars who have been critical of its business model.
The company charges $10, €10 or £10 per month for unlimited access to its library of more than 20m songs. Artists receive payments “per stream”, which has proved contentious for some stars: Thom Yorke, the Radiohead and Atoms for Peace frontman, recently called Spotify “the last desperate fart of a dying corpse”.
Launching an expansion to the amount of free listening available to Spotify’s users on smartphones and tablets last week, chief executive Daniel Ek said that his company has paid out more than $1bn to the music industry, more than 70 per cent of its revenue from subscriptions and advertising.
“We understand the scepticism,” Mr Ek said at the New York press event. “By giving people more access to legal free music on any device, we believe they will stream more overall. We see this clearly in our data: the more music you play, the more you’re likely to pay.”
One indication that the music industry is becoming convinced that Spotify’s model will work is the growing number of countries that labels and publishers have licensed it in – up from 17 a year ago to 55 today.
Spotify also claims real scale for its most popular artists, noting that R andom Access Memories had been streamed 300m times since its release in May. However, some smaller artists complain that the lower volumes of listening they receive net them much less money than they would get from sales of downloads or CDs.
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