In the Streaming Age, Taylor Swift Plugs 'Reputation' on CD

By Anne Steele Features Dow Jones Newswires

Taylor Swift appears to be staking her reputation on CD sales.

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While the music industry is watching to see if the pop star's new album can match the sales of her previous blockbuster, a bigger question for many concerns how her sixth studio effort, "Reputation," will be made available when it comes out Friday.

The album is unlikely to be heard on streaming services when it's released, according to people familiar with the matter. Initial discussions indicated such a streaming blackout could last as little as a week or two after the album's release, according to one of these people, who said the final decision was up to Ms. Swift and her inner circle. So far, that group hasn't shared its plans with many business partners. Ms. Swift's label, Big Machine Records, declined to comment on plans for the new album.

After releasing her previous album, "1989," in 2014, Ms. Swift waited seven months before allowing any streaming services to carry it.

Three years later, however, streaming has overtaken download sales and CDs as the most popular way to listen to music, and it's unclear whether it will be feasible to keep the new album off Spotify AB, Apple Music and other services for as long.

So far this year streaming is responsible for about 60% of music consumption in the U.S., according to Nielsen Music, which measures sales and streams in units, rather than in dollars, and treats 1,500 streams as the equivalent of one album sale.

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All signs point to strong sales momentum ahead of Friday's release.

"Reputation" has already generated 400,000 preorders for digital and physical copies -- more than double the figure for "1989," according to Big Machine. That album was released when sales still generated more revenue than streaming in the U.S., according to the Recording Industry Association of America.

Sales remain a huge opportunity for Ms. Swift. A superstar artist can receive as much as 20% of the proceeds from album sales.

In the first weeks after the release of a heavily promoted album like "Reputation," that can make sales far more profitable than streaming, which generates royalties worth tiny fractions of a penny per listen. Over the long term, those micropayments can add up to big money for hit songs and albums.

Last week, streaming accounted for 75% of total retail volume for "1989," according to Nielsen.

While the singles off of "Reputation" so far haven't had the same chart success as those on "1989," that doesn't appear to have diminished demand for the album, said David Bakula, a Nielsen Entertainment analyst.

The first four singles on the album indicate a more synth-heavy -- and, at times, bass-heavy -- brand of pop, while the set list includes a collaboration with singer-songwriter Ed Sheeran and rapper Future. Three of the same pop masterminds who worked on "1989," Jack Antonoff, Max Martin and Shellback, are listed as producers.

Ms. Swift is using various incentives to encourage her loyal fan base to buy the new album on CD. Ordering a copy from her website can boost a buyer's chances of securing tickets to her coming concert tour.

Target Corp. says "Reputation" has generated more preorders than any album before it, and expects the album to be its biggest music release of the season.

The chain's biggest seller to date is Adele's "25," which was held from streaming for the better part of the first year after it came out in 2015, when streaming became the biggest segment of the U.S. music market.

Target is offering two different 72-page special-edition magazines featuring portraits, personal photos as well as poetry and paintings by Ms. Swift with each album purchase. It expects many fans, who call themselves "Swifties," to purchase two copies of the album to have both magazines, said Lee Henderson, a company spokesman.

"We look for a way to give fans something they can't get anywhere else," said Mr. Henderson.

Until the middle of this year, none of Ms. Swift's music was available on Spotify, by far the most popular streaming service, with about twice as many users as No. 2 Apple Music.

Ms. Swift wanted her music to be available only to paying subscribers; Spotify insisted that all its users -- including those who use its free, ad-supported option -- be able to listen to it. In June, Ms. Swift put her entire catalog on Spotify, including its free tier. By then, "1989" had sold 10 million copies world-wide, according to her management team.

It's too soon to say what keeping "Reputation" off streaming services would mean for its overall performance.

"This was going to be heavily purchased album anyway," said Nielsen's Mr. Bakula.

Since Ms. Swift's fan base is largely made up of younger consumers who listen to music via streaming, she could effectively get paid twice for the same album, as fans purchase a digital or physical copy of "Reputation" then continue to listen to it on the subscription services they typically use.

With or without streaming, says Mr. Bakula, "it's going to be a blockbuster one way or another."

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

November 08, 2017 18:16 ET (23:16 GMT)