A shortcut up the chart

Thanks to their old hits, plenty of veteran music stars can still pack in concert crowds -- the problem is their new music often ends up cluttering the discount bins at record stores. Now, though, it appears there’s a novel way for those artists to turn concertgoers into a semi-captive audience that pushes a new album up the charts with every flip of the arena turnstile.

The story line began weeks ago when Prince announced that a free copy of his new CD, “Musicology,” would be given to fans who attended his concerts, a promotional promise repeated in advertisements for his now-underway tour. It turns out that was an imprecise description -- according to promoters, the cost of the CD was in fact figured into the ticket prices. In essence, fans were buying the album (although it was at a discounted price) and they had as little say in the transaction as they would on ticket surcharges.

The entire matter took on much more interest for music industry executives last week when Nielsen SoundScan decided that each “Musicology” disc handed out at shows would be counted as a sold CD, the same as one sold at retail. Because SoundScan data shape the nation’s music charts and define the industry bottom line, the decision has started an insider debate that, like steroid-juiced home runs, is about fairness, high-profile statistics and competition culture.

“These were presented to the public as being free CDs, they are handed to people who had no choice in buying them, and that really shouldn’t be recognized as the same as the other albums on the chart,” one high-ranking executive at a major label said Friday. He spoke on condition of anonymity because of the sensitivity of the matter and because “for all I know, my boss might think it’s a great idea and want us to try it.”

The tickets to see Prince range from $47 to $75 in most cities and, with robust sales and strong reviews, it’s a safe bet that most of his fans are happy with the price point, CD or not. Promoters of the tour declined to get into the exact cost of the CDs they purchased from Sony Music Distribution or the cost passed on to fans, but regardless of those numbers the ticket price is well in line with market prices.

The more unsettled matter is whether the CDs should be counted the same in the SoundScan reports that feed into the weekly music charts that appear in Billboard, this newspaper and across news media that cover entertainment and music trends.

To Rob Sisco, president of Nielsen Music, the matter took some thought, but the answer was found in flipping the question. “How can we justify not counting them? That’s what it came down to for me.”

Sisco noted that the sale of hybrid products, such as “The New Breed,” the bundled 50 Cent CD and DVD that topped the album chart last year, is part of an industry looking for ways to deal with slumping sales, competing mediums and the unruly frontier of the Internet. “This is a time for looking at new ideas and new ways to do business, and this is one of those ideas.”

Randy Phillips, president and chief executive of AEG/Live, the tour promoter for “Musicology,” said the bundling of a concert ticket and CD is an approach that might quickly become a familiar one. “No question about it, you’re going to see a lot of veteran acts look at this as a way to go, and they are going to be looking at other ways. Music is always going to have a place in the fabric of our culture, but the way that music is delivered and defined is going to continue to change.”

Nielsen SoundScan began tracking the arena CDs on Tuesday, the day “Musicology” arrived in stores. That starting line was picked for practicality issues such as bar-code assignment and chart-debut mechanics, Sisco said. The tour has more than 40 shows, most in arenas with a capacity of 10,000 to 19,000. The schedule is spread out enough that Prince won’t get to the top of the music charts in any given week just from his concert-as-store approach, but collectively the show CDs will add 400,000 copies to his sales tally. A record is certified as gold at 500,000 units sold, platinum at 1 million copies.

The label for the album, Columbia Records, said in a statement that the chart attention to the arena CDs “makes sense” and lauded any method that would help fans of the celebrated singer get his music faster, more easily and in a fashion that taps the excitement of the concert experience.

One other especially interested party in the matter is Billboard, the music industry trade publication that is practically defined by its music charts. SoundScan data are a major component in many of Billboard’s linchpin charts, and charts editor Geoff Mayfield said Friday that any new variable in the business math gives him pause.

Mayfield said the publication’s expanding definition of music sales -- record club sales and digital downloads are some recent arrivals in the columns -- has room for more, and he praised any industry innovation. But he also said: “If this bundling becomes a widespread practice and seems to be distorting the chart, we probably would talk to SoundScan about potential revisions of the policy.”

Could it become widespread? Certainly, the Rolling Stones, the Eagles or Fleetwood Mac could bundle in a new studio album or even a low-labor live recording with one of their tours and expect a platinum album to be mined from their box office. Royalty issues and the impact on retail sales would be in the mix as factors, but it seems likely that this hybrid isn’t a one-time creature.

Some observers have wondered if the Prince approach would cannibalize his retail sales, and certainly the fans who get the CD at the show will be far less likely to buy one. On the flip side, there will presumably be a good number of fans who have two copies in their household since some of the most loyal fans might want the music before the tour comes to town. There’s also the couple factor -- anyone who goes to the show with a household partner will end up with two copies of “Musicology” on the drive home.

And could other ticket types be brought into the business model? What if Disneyland decided that admission to the park one day would include the price of an album by one of its stars? One summer Saturday could score the kid a hit record.

“We would have to look at each individual case and judge it,” Sisco said. One of the factors is the service only tracks music sales made at places where a CD selection is a routine part of retail floor space. Concert vendor booths make arenas eligible but not, say, some movie theaters where CD singles can be purchased with sodas. Disneyland sells CDs in some shops, but Sisco declined to offer a snap judgment on that hypothetical.

“It’s a changing business, and change is good,” he said. “Everyone has to have an open mind.”

Another music executive who was critical of the SoundScan decision to tally the CDs as sold units said he has no problem with the bundling approach -- “It’s a great idea, actually” -- but that in the future the easy way to sidestep controversy would be to offer two ticket prices for fans, one that includes the CD and the other that doesn’t. “But, of course, if you do it the way Prince is doing it, you have one big advantage. Nobody can say no to that new CD if they want to see the show.”