In the Battle for Music Chart Supremacy, DJ Khaled and Nielsen Reign, But Can the Game Be Goosed?

Back before Nielsen introduced SoundScan in March 1991, the Billboard album chart was compiled by having retail assistants fill out paper forms by hand listing the store’s best sellers. Some 26 years later, the digital age has ushered in a time of quantifiable, instant data with which a music company can track even the most granular of metrics in the blink of an eye — or a click of the mouse, as it were.

So why, then, are there discrepancies between the Nielsen Music chart, which powers, among other tallies, the Billboard 200, and BuzzAngle Music’s consumption chart, a more recent entry to the chart game which differentiates itself as “an analytics company.” One such inconsistency occurred just last week when Nielsen had the stream-heavy DJ Khaled album, “Grateful” (released by Epic Records on June 30), at No. 1, while BuzzAngle placed Imagine Dragons’ physical/download-supported “Evolve” (Geffen) atop their album chart, amid industry whispers about the former benefiting from 20 million phantom streams, according to a source.

Neither BuzzAngle or Nielsen would comment specifically about the Khaled numbers, but Nielsen SVP Music Industry Insights Dave Bakula and Border City Media CEO Jim Lidestri, who founded BuzzAngle, did speak to Variety about their methodology — and why the results sometimes differ, on the heels of the companies’ 2017 mid-year reports, which were issued this past week.

In their mid-year breakdowns, both Nielsen and BuzzAngle optimistically noted the continued growth of streaming and total music consumption (a combination of album sales plus TEA [Track Equivalent Album] song sales — each counting 1/10– along with on-demand streaming (SEA) both video and audio, at 1500 streams = one album). Nielsen reported total consumption through six months at 302.4 million with a growth rate of 8.1%, while BuzzAngle’s figures had it pegged at 292 million, a 9.9% year-to-year increase.

Elsewhere, the two surveys were pretty much in a similar range in most categories, with the exception of physical album sales – vinyl and CDs – where Nielsen has the total dropping from 58.5 million last year to 46.9 million this year, a precipitous decline of 17%, while BuzzAngle noted a far less 2.1 % decrease from 40.4 million last year to 39.5 million this year.

Nielsen’s Bakula suggests the reason for the disparity is that rival BuzzAngle does not include reports from Walmart, the nation’s largest physical retailer left standing (though that wouldn’t explain Imagine Dragons’ dominance over Khaled on the BuzzAngle album chart). Lidestri, a tech veteran of IBM, Sprint and Houston-based start-up Interliant, who three years ago launched a beta version of BuzzAngle, blames the discrepancy on Nielsen’s system of weighting its store figures with an “inconsistent” formula to account for smaller independents that fall between the reporting cracks.

As Nielsen itself describes its methodology, “Sales data from point-of-sale cash registers is collected weekly from over 14,000 retail, mass merchant and non-traditional (on-line stores, venues, etc.) outlets,” which is then registered every time a barcode is swiped. Anyone with either a UPC or EAN barcode (for the album) or ISRC code (for individual tracks) is eligible to be counted. As for online retailers like Amazon or streaming services such as Apple Music or Spotify, Nielsen is reliant on reports from the companies themselves, which is one reason why Jay Z’s “4:44” won’t be on the Billboard or any other chart this week since Tidal declines to provide the numbers. It’s also where the possibilities of corruption come in.

The only other real differences is in the respective services’ definition of genre, obviously a subjective issue.  While Nielsen designates its leading market-share category as R&B/Hip-Hop (with a share of 25.1%), BuzzAngle dubs the style Hip-Hop/Rap and has it at a still top-rated 20.6% (with an additional 9.3% for R&B).  And while BuzzAngle breaks its Rock (7.3%) category off from Alternative (5.8%), Indie Rock (4/4%), Metal (2.7%) and Punk (2.5%), Nielsen includes them all as Rock with 23% of the total, still second behind dominant R&B/Hip-Hop. Whichever way you look at it, the raw streaming data points to a dynamic shift in music consumer patterns, just as the adoption of SoundScan presaged the underestimated marketplace power of country and rap in those first few new charts.

Since its official debut last year, BuzzAngle has brought on a number of clients, from mainstream outlets like the Recording Industry Association of American (RIAA) and Music Biz (formerly NARM) to feisty trade mag HITS, with its offer of cheaper prices (at least 65% less for smaller clients that pay less than $20,000 annually, and 35% less, for major clients). Indeed, the newcomer’s ability to deliver information in real-time, daily, and on a global scale, and to go deeper than the traditional Top 10, Top 100 and Top 200, has made it a favorite for A&R departments looking to uncover the next big thing, and marketing departments seeking out regional areas of support for touring bands.

“I started BuzzAngle because I didn’t think the market was being served from a data/analytics standpoint,” says Lidestri.  “The Top 200 is fine, but if you wanted to drill down to test the efficiency of your marketing campaign, or how your artists are doing on tour, or wanting to know who to sign, it was woefully inadequate. They are a charting and reporting service, while we’re an analytics company.”

And while both Nielsen and BuzzAngle are documenting the historic increases in streaming over the past 18 months, the issue of profitability continues to shadow major record labels and standalone online services like Spotify alike.  At this point, the recording industry is still languishing at about half of its turn-of-the-century $13 billion-plus revenue height, and no amount of bookkeeping can change that overnight.  And that’s true whether you attribute more weight to streams from paid subscription services than those from ad-supported free tiers or not, which neither Nielsen nor BuzzAngle do in their charts.

BuzzAngle’s Lidestri insists the idea of a “paid” vs. “free” stream will eventually have to be incorporated into their tallies. “Is it the same thing when a user says I want to listen to this track as opposed to putting on a playlist?  It’s not.  Should we count audio and video streams at the same rate?”

“Our charts aren’t meant to show differences in revenue,” explains Nielsen’s Bakula. “It’s more about overall consumption. If the consumer wants to hear a song, whether they’re listening on a premium service or watching it for free on YouTube, there’s no difference for us.  These charts aren’t about who’s making the most money, but rather whom the consumer is demanding the most.”

And that means, don’t expect record labels and artists to suddenly come clean about their own finances.  Neither SoundScan nor BuzzAngle will have access to that information anytime soon – even if it’s different in other industries, like motion pictures, which routinely publishes a chart of box office grosses.

All of this begs the question as to whether the industry actually needs both services in this David & Goliath battle of a nimble newcomer taking on the established dominant player in the game.  On the internet, usually only one dominant player survives. Can two?

“I don’t really have a preference at this stage,” says veteran artist manager Ian Montone, whose clients include Jack White, The Shins and Danger Mouse. “I am used to Nielsen, but am training myself to pay attention to BuzzAngle and a few other models. Frankly, I look at streams and ticket sales more than either.”

For whatever their minor differences in methodology, both Bakula and Lidestri welcome the competition.

“It’s healthy and great for the clients,” offers Bakula. “They love being able to bargain. It gives them more negotiating power, the ability to look at things in a different way, that are resourced or accessed uniquely.  It’s good for the industry, and as an analyst and music lover, someone who wants this business to be healthy and success, that’s a good thing.  What I don’t like is when there’s an inconsistency, which casts a doubt on all the results.”

Lidestri, who burst onto the scene with dreams of slaying SoundScan, now looks at their natural rivalry a little differently. “I did view it as us vs. them in the beginning, but now that we’ve matured and established ourselves as pretty solid, it’s more about how important it is to look at what both of us bring to the table,” he says. “I think we’ve helped them up their game. Of course, in the end, I’d still rather be David than Goliath.”

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