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I.B. BAD: THE ALGO
& THE ECSTASY

Q4 HEAT: P!nk’s Beautiful Trauma has racked up gigantic first-week sales with 407k SPS—roughly half of those sales attributable to a ticket bundle. That’s about a 25% jump over her previous release of 280k, making it the year’s fourth-largest debut behind Kendrick Lamar, Ed Sheeran and Drake. The Roger Davies-managed pop star joins a pair of breakout RCA debut artists, Khalid (951k SPS) and SZA (510k), in ramping up the label’s momentum at the ideal time, with Joe Riccitelli and John Fleckenstein picking up some of the slack left by Tom Corson’s departure in the wake of the WMG press release. What’s more, the Peter Edge-led company is prepping a potential blockbuster from Justin Timberlake, which will be further bolstered by his performance on the Super Bowl halftime show. And according to the latest talk, G-Eazy may have an album in December. Will RCA’s streaming share hit 7% in the 2017 final standings?

SO ANNOYING: As dissatisfaction with John Amato and Billboard reaches critical mass across the music business, the trade has decided to adjust its Top 200 albums chart by giving greater weight to on-demand paid streams over ad-supported, but it will not add YouTube streams. That amounts to a partial victory for the rights holders and a big win for Apple Music, but it’s not great news for Spotify’s ad-supported tier and worse yet for YouTube. This industry-supported move indicates that Amato caved to the pressure as threats mounted by rejecting a proposal from Lyor Cohen that Billboard add YouTube streams to the Top 200. In other words, Amato stumbled upon a compromise, but is that compromise too little too late? It was undercut by his decision to retain YouTube streams in the Hot 100 singles chart, which angered the rights holders. What’s more, the Bible’s decision to give them less weight than premium streams still doesn’t fix the problem that label execs have been complaining about since YouTube views were first added to the Hot 100 panel in early 2013—namely, that YouTube stats are easily manipulated.

Case in point: Fader reported last week that an audio clip of Post Malone’s “rockstar” containing nothing more than a loop of the song’s hook, with a running time identical to that of the actual track, had been viewed 42m+ times, vaulting it to #1 on the Hot 100, pushing Atlantic’s Cardi B from the top spot, ironically enough. Whether the clip—which is technically an ad—was uploaded with intent to increase spins by Republic isn’t yet known, but the label violated no rules, exposing a readily gameable flaw in YouTube’s reporting system and in Billboard’s chart protocols.

When Amato, a music-biz newbie, seriously entertained Cohen’s proposal, was he unaware of this world-class charlatan’s history of unacceptable behavior, which is readily acknowledged by all in the business—apart from one high-profile exec who continues to have his back no matter what. Cohen’s pattern throughout his career has involved conning some of the most wealthy and powerful—a distinguished list that includes Russell Simmons, Tommy Mottola, Alain Levy, Chris Blackwell, Doug Morris, Edgar Bronfman Jr. and Len Blavatnik, until they eventually wake up and feel the burn. When will YouTube topper Robert Kyncl, who hired him as the site’s global head of music—realize what a nightmare he has on his hands? Only Jimmy Iovine spotted Cohen’s deceitful nature; that happened nearly 20 years ago when he was running Interscope and Cohen was heading up IDJ. There is still no love lost, as these two longtime adversaries continue to square off.

Speaking of conning, Cohen told The Wall Street Journal in April that YouTube would be fine-tuning its recommendations “so that the algorithm…considers artist and label promotional activities.” A month later, he claimed to Recode that 80% of all of watch time is recommended by YouTube, and that that he would apply label and artist priorities to the recommendations. In other words, Cohen says he intends to jack the algo, which is a tacit acknowledgment of YouTube’s manipulability.

The problem goes far deeper than Cohen, of course. Google has long evidenced a contemptuous attitude toward music, most egregiously manifested by its outright refusal to pay a fair royalty despite the fact that the tech behemoth is filthy rich; at presstime, parent company Alphabet’s market cap is a staggering $693 billion.

The Bible hasn’t yet revealed specifically how its chart components will be weighted, so the battle is not yet over. Will another failure on Amato’s part to take the industry’s needs seriously lead to DEFCON 1, wherein the labels stop doing business with the once-respected trade altogether? A moratorium on advertising is already at the top of the agenda for one major.

Additionally, a plan is rumored to be afoot that would replace the trade’s charts with a new set of charts compiled in conjunction with the industry itself, like the Official Charts Company in the U.K. One provocative rumor has the OCC planning to launch a U.S. division—not an absurd notion, considering the Big Three music groups as well as the biggest worldwide indies are all now headed by Brits. Theoretically, these new charts could be calculated in similar fashion to the OCC, which doesn’t count YouTube or SoundCloud; otherwise, all streams, premium and ad-supported alike, are counted equally—a calculus that would in all likelihood be modified for the U.S. version.

Against this turbulent backdrop, a major reorganization of the Bible is rumored to be imminent, with personnel cuts in all departments, as the bleeding continues. The company is on the block for a reported $150m, begging the question, why would anyone pay that kind of money for a mature business that has been losing an average of $20m for the last seven years?

THE BUNDLING GAMBIT: P!nk’s bundle of approximately 200k is the biggest of the year thus far, roughly twice the size of the first-week bundles of Katy Perry and Shania Twain. But only acts who are giant concert attractions can exploit the bundling gambit at the optimum level. Kenny Chesney appears to be the extreme example, as tickets for his 18-stadium tour went on sale on 10/18 in conjunction with his upcoming live album (Sony Music Nashville), dropping 10/27, setting up what is shaping up as the biggest bundle of all time. Could he sell a million tickets? Chesney’s previous LP bowed with 89k; it’s safe to say that this one will do far better.

Pretty much every major is now playing the game with its big acts, as bundling becomes a standard part of the modern-day marketing campaign. The practice, which boosts first-week chart position, has become a priority in response to the decline in album downloads at iTunes and the other online retailers, which are down 20% YTD.

Apple itself is in the process of de-emphasizing download sales at iTunes, which removed the 69-cent homepage slider in late September, serving to democratize the iTunes songs chart, which has seen a 50% decrease in discounted tracks in the chart’s top 40 resulting from this lowering of visibility. Sony Music had been pushing for such a change.

LAME DUCK UPDATE: While it’s certain that RCA President/COO Tom Corson and Interscope President of A&R Aaron Bay-Schuck will become co-heads of Warner Bros. Records, their respective start dates remain a mystery. Bay-Schuck continues to A&R projects for Interscope, but Corson is nowhere to be seen on the 23rd floor of the Sony building. There has been no apparent movement in terms of either getting out of his current deal early; Corson’s contract is up in late March, Bay-Schuck’s expires at the end of September. Is John Janick looking for the right player to replace Bay-Schuck? Oddsmakers say he will give a strong look inside his old hood.

NAMES IN THE RUMOR MILL: Monte Lipman, Troy Carter, Michelle Jubelirer, Mark Williams, Scott Borchetta, Dennis Kooker, Benny Pough and Jo Charrington

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