How Beyoncé’s Lemonade is making $3m a day – while saving Jay Z’s business

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MBW review-1Each week, The MBW Review gives our take on some of the biggest news stories of the previous seven days. This week, we’re take a speculative look at whether Lemonade – the greatest blockbuster album experiment for some time – is paying off for Beyoncé and her label. The MBW Review is supported by FUGA. (The views in these articles are those of the writer and are not necessarily endorsed by our supporter.)


Screen Shot 2016-04-24 at 17.27.38I’mma let you finish, but Beyoncé had one of the most hotly-debated album rollouts of all time.

As MBW reported over the weekend, the superstar’s Lemonade appeared as a TIDAL exclusive on Saturday (April 23), spurring both a major boost for the streaming service – and rather a lot of piracy activity on torrent sites.

Yet those who thought the Texas-born superstar and her label, Columbia, had fluffed Lemonade’s release will be eating their words now.

Because although the album took over 24 hours to come to iTunes, and isn’t quite reaching the download heights of it predecessor, it currently has two huge things going for it:

  • (i) It’s going to storm the US charts this weekend anyway; and
  • (ii) It’s priced significantly higher than your average new blockbuster record – meaning every one of its 375k+ US online sales so far will have been extra sweet for Sony.

Last night, US sales monitor BuzzAngle told MBW that Lemonade is currently the No.1 album on its week-to-date chart – across the five days from Friday (April 22) through Tuesday (April 26).

As a result, it’s looking odds-on to be the nation’s No.1 this Friday.

Most importantly, BuzzAngle reports that Lemonade sold 439,830 album project units in the US across this period  – including 375,000 sales on iTunes/Amazon alone.

Now, Lemonade was released on TIDAL on Saturday night as its ‘visual album’ special aired on HBO.

Yet didn’t land on iTunes in the US until the very early hours of Monday (April 25). So BuzzAngle’s figures only really represent two days of full ‘proper’ album sales on non-TIDAL outlets.

In other words, Lemonade sold an average of 187,500 US downloads per day across Monday and Tuesday.

Here’s the really killer thing, which has been a bit overlooked in amongst all of the TIDAL/piracy/did Jay-cheat-or-is-this-a-fictional-construct-oh-probably-the-latter debate: Lemonade is slyly priced at a premium on iTunes, at $17.99. (This isn’t a US-only decision – it’s £13.99 in the UK.)

Screen Shot 2016-04-28 at 08.59.47

That’s significantly higher than the standard album price on Apple store. Adele’s 25, for instance, is $10.99 on iTunes in the US today.

Beyoncé’s biggest rival for the No.1 US chart spot, Prince’s Purple Rain (210,000 combined five-day sales, says BuzzAngle), is $9.99.

Lemonade’s pricetag is even higher than the $15.99-per-unit cost of Beyonce’s last big cultural moment – when she shock-released her self-titled previous studio album in December 2013.

So let’s break that down.

If Lemonade is selling 187,500 downloads a day in the US right now, it’s turning over $3.37m every 24 hours – on download stores alone.

Across just Monday and Tuesday – and remember, we haven’t even touched streaming yet – that equated to $6.75m.

Now, back in 2013, Beyoncé’s last album had much more going for it, sales-wise:

  • It wasn’t available on any streaming services;
  • It hit iTunes on day one, rather than pushing impatient non-TIDAL fans to pirate services;
  • The US download market was very significantly stronger than it is now. (Total annual US music download sales, according to the RIAA, fell by more than $500m between 2013 and 2015.)

Estimates in the market from 2013 suggested that Beyoncé’s Beyoncé sold 617,000 during its first three days on sale.

That works out at 205,666 copies per day – a chunk higher than the 187,500 per day we’re crediting to Lemonade.

Don’t panic.

Remember that Beyoncé’s Beyoncé cost $2 less per unit than Lemonade ($17.99 > $15.99).

Therefore, Beyoncé was actually averaging $3.29m in album download revenue per day in 2013 – less than Lemonade is right now.

And get this. The 2013 album was only available to buy in full. Fans couldn’t handpick tracks – it was all in, or nothing.

With Lemonade, fans can un-bundle the album till their heart’s content on download sites.

Just look at the US iTunes song download chart today:

  1. Formation – Beyoncé
  2. Hold Up – Beyoncé
  3. Sorry – Beyoncé
  4. 6 Inch – Beyoncé
  5. One Dance – Drake
  6. Don’t Hurt Yourself – Beyoncé
  7. Freedom – Beyoncé
  8. 7 Years – Lukas Graham
  9. Panda – Desiigner
  10. All Night – Beyoncé

She also has four of the next ten most popular tracks on today’s chart.

Every one of those downloads comes with a pricetag of $1.29.

Back to BuzzAngle’s five-day figures: 439,830 ‘album project units’ – 375,000 sales.

Take one from the other, and we’re left with 64,830 album equivalents.

Right now, we don’t know how much of this is streaming and how much is download.

BuzzAngle equates 10 track downloads to one album sale, but also 1,500 on-demand streams.

[Update]: If you cut the 64,830 figure into halves – with 50% taken up by download and the other 50% by streaming – you’re talking about 324,150 downloads and 48.6m streams.

On this (very conservative) basis, a bit more financial maths: 324,150 X $1.29 (iTunes download price) = $418,154.

And then we get into Lemonade’s exclusive streaming partner, TIDAL.

Last year, TIDAL claimed its average per-stream payout was $0.026. Across Lemonade’s 48.6m streams in our guesstimate, that’s another $1.26m.

All of which means that Lemonade will have taken over $8.3m in its first five days of availability in the US, with its biggest cash cow – downloads – providing somewhere around 85% of revenue.

(If anything, our estimate is actually too generous to TIDAL/streaming and not generous enough to track downloads – although the former is a wholesale figure.)

TIDAL is providing a small amount of Lemonade’s total income – an album that’s already proven itself able to sell in huge numbers as a premium transactional product.

So… was Beyonce’s commitment to TIDAL a mis-step? Depends on how you look at it.

Beyonce is believed to own 3% in the streaming service. Her husband, Jay Z, is the majority shareholder.

Look what’s happened to TIDAL’s most-downloaded chart position on the iOS App Store in the US before and since Lemonade’s release.

  • On Saturday, according to App Annie, it was the third most popular music app download.
  • On Sunday (April 24), it became the No.1 – and it’s stayed there ever since, above the likes of Spotify, SoundCloud and Pandora.

Screen Shot 2016-04-28 at 09.45.23

Meanwhile, TIDAL’s currently looking very secure as the third highest-grossing music app (daily) on iOS, behind Spotify and Pandora but comfortably above Rhapsody, YouTube Music and Slacker Radio.

So Lemonade appears to have done much more for TIDAL than TIDAL’s done for Lemonade.

Namely, making the streaming service a far more attractive prospect for would-be acquirers like Samsung.

As a result of Lemonade, TIDAL has enjoyed many more sign-ups, much higher brand awareness, a sustained run at No.1 on the US app chart and an increasingly solid subscriber income.

When TIDAL gets sold – and I for one can’t see Jay Z sticking around too long with what must be a loss-making entity – Beyoncé the shareholder will collect her winnings.

She won’t see any such a windfall when Spotify IPOs – that’ll all go to investors and the major labels. Despite it being a business completely built off the popularity of superstar artists like… Beyoncé.

Right now, the former Miss Knowles – in tandem with Jay Z, Columbia and Sony – seems to be sitting pretty.

Beyoncé did what she needed to do for her business interests.

Columbia got its way by putting Lemonade on iTunes – even though it had an agonizing wait.

Someone, somewhere, made a hell of a call on the retail price of the album.

The only person tasting bitter lemons right now?

That would be Daniel Ek.


Screen Shot 2016-04-04 at 13.35.51The MBW Review is supported by FUGA, the high-end technology partner for content owners and distributors. FUGA is the number one choice for some of the largest labels, management companies and distributors worldwide. With a broad array of services, its adaptable and flexible platform has been built, in conjunction with leading music partners, to provide seamless integration and meet rapidly evolving industry requirements. Learn more at www.fuga.comMusic Business Worldwide

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  • Music_Lover

    I would like to add, that according to data, Tidal is doing fine in the growth department. The service added 857k and 755k subs in March and April (thus far) respectively (across the Apple and Google Play stores). If we’re using the reported number from the March 29th PR, the subs would be somewhere between 3.6-3.9 million today. When you factor in that over 40% of users pay the $19.99 rate, I think its safe to say the service has grown quite nicely under new ownership. (Annual revenue would be on pace to fall between ~$600-650 million. *This number does not account for the student plans at the $4.99 rate.

    I think we have to remember that this service was launched with very little capital compared to the billions backing both Spotify and Apple music, so the service will have bumps and bruises along the way as it continues to grow (Its only been a little over a year).

    • speakerboxtv

      Spotify may be losing out, but Beyoncé and team are also leaving money on the table. For Spotify listeners such as myself, who rarely purchase music downloads and will not switch streaming services for the sake of a single artist, Lemonade missed my money. The idea of long-term exclusives (a game both Tidal and Apple are employing) in the streaming space is an ill-conceived strategy that alienates potential fans/listeners. Furthermore, Tidal was positioned as a streaming platform for-the-artist, by-the-artist. If Jay Z and company cash-out to a major corporation, Tidal immediately compromises its brand and its potential to secure artist exclusives (as the likes of Kanye and Beyoncé no longer have a stake in the business).

      • Music_Lover

        (1) I don’t think the artists involved here are all that concerned with album sales tbh (more of the labels’ concern). Artist really don’t make a tone of money on album sales, the show/concert is pretty much where they earn their keep. (2) It appears that you are a paying user of Spofity so I can understand your issue (I would be upset too), but the reality is that the vast majority of Spotify users aren’t paying which has resulted in the service dealing with increased competition from Apple, Tidal, etc. The ad supported payout model won’t move the company out of the red. I would also like to highlight that several label heads (labels have equity in Spotify) have come out stating that exclusives are here to stay. (3) In the event of a Tidal equity sale, I don’t think we would see a complete exit by Jay Z & company here. I think it is more likely that their equity gets diluted for a strategic partner to come in and build out the company. There are more than a few companies who would be interested w/ the artist staying on to continue supporting the brand. (4) I raised the point above not to take sides or advocate for one service over another, but to highlight that new Tidal team has done a tremendous job building the user base/subscribers of the service in little over a years time, with little equity put in. For a $56 million investment, it has definitely become another successful investment for Jay Z. If this service gets to the 7-8 million subscriber range and maintains that %40 HiFi user rate, this is a ~1 billion dollar (annually) grossing app. I don’t see how anyone could frown upon that. I admire entrepreneurship and risk taking. This is a great example of that.

        • #1Scammer

          Your analysis is so simple. Wonder why JayZ receives all the negative comments when facts are showing, from just two albums (TLOB and LEMONADE), that milluons of people are flocking to Tidal. Hate to play the race card here, it’s 2016. But even in this article the author mentioned JayZ selling the company.

        • speakerboxtv

          Thanks for your insightful perspective. A few notes… (1) While Beyonce’s publishing royalties may be quite diluted, she probably earns a favourable percentage on every album sold/streamed as the recording artist. And given the involvement of HBO in the album’s rollout, her record label may have little to recoup from Lemonade before she starts seeing the benefits. So album sales/streams could still prove a significant revenue stream for her. (2) Spotify has +30 million paying users (in addition to their 70 million freemium users) – which is still a sizeable audience to ignore. Spotify’s paying user-base is larger than the collective subscribers of Tidal and Apple Music (in fact, around double). Yes, each of the major labels have a stake in Spotify – meaning they get paid on both ends, yet Spotify is not the platform focused on pushing exclusive distribution arrangements. Ultimately, exclusives only promote piracy. My argument is that, at this point in time, all streaming platforms should be concentrating on growing the adoption of music streaming rather than fragmenting the market. (3) I agree, a Tidal equity sale most probably won’t mean a complete exit by Jay Z and company, however it will still dilute their core position as a platform for-the-artist, by-the-artist, and the media will be quick to highlight that fact. (4) Again, agreed. Tidal has done well so far and should be admired for their accomplishments. My only concern is that their approach will cap their potential.

          • Music_Lover

            I think these are all fair points. I honestly think the “alienating the fan base” argument is a little over blown by the press and blog heads who usually have some bias coming from some unspoken affiliations. What I find interesting is the number of services who are still jumping in the streaming game as we speak. (I think two new ones just popped up this week.) That tells me that this market is in hyper growth and has much more room to expand. I see this streaming “war” settling with 3 to 4 major services and the rest being bought up by the survivors. We could have a Universal, Sony, & Warner type situation in the end. If that is the case, I see Tidal being somewhere in the mix (with a partner that came to provide broader distribution channels, because I think this is where the service is outgunned by Spotify and Apple. Its actually amazing to me that the service is growing at this rate with completely organic-self selected subs. Apple had over 100 million phones to push their service almost instantly upon launch. I actually think its pretty unimpressive to only have 13 million at this stage with such a massive base built in to pitch to.)

      • Jamie Jay

        Adele didn’t release her album on any streaming services either so I guess you missed her money as well. Oh well, who cares. I love her album and think she’s a great artist who thinks outside the box.

        • speakerboxtv

          This article is focused on the financial windfall of the album and suggests that its exclusivity to Tidal maximised its revenue potential for Beyonce. My comment simply suggests that Lemonade could possibly make more if it were available across all streaming platforms (in the long-term). That’s all. It was a response to this particular article and was not an opinion on the artist. An artist/label should be able to dictate which distribution channels carry their albums – just as Beyonce and Adele have. However, they must also appreciate that they can alienate large consumer segments by choosing the exclusivity route.

      • christinanolanXD

        Nobody fucking wants your money you cheap ass bitch lol

        • speakerboxtv

          Hi, Christina Nolan. Nice to meet you, too.

      • Oh please

        Lemonade missed your money, what money. You don’t pay for your music.

        • speakerboxtv

          Try replying with a supported opinion rather than an unfounded assumption.

          • Oh please

            You said you stream your music for free not me. If you stream for free how exactly do you think the artists make any money? The streaming service you use to get your “free” music is not a charity it’s a business. You get free music, the streaming company makes money but the artists get screwed! It isn’t rocket science.

          • speakerboxtv

            I never said I stream music for free, I said I “rarely purchase music downloads”. Secondly, Spotify’s free membership plan is ad-supported with 70% of all revenue going to the rights holders. In reality, the labels/artists are getting paid while Spotify is yet to turn a profit. More to the point, these free streaming memberships are generating income for artists from listeners who would otherwise be downloading their music for free – or not at all. I fail to see how that’s a bad thing.

          • Oh please

            So the artists, song writers, AND musicians of varying degrees of success are just making it up? I’ll say it again free is NEVER free. I will add to that cheap is NEVER cheap. Someone is paying for that and it’s not the company and it doesn’t sound like it’s you. What ever happened to paying someone for their work? You expect to be paid.

          • speakerboxtv

            The general argument from artists seems to be that they are not seeing the same size royalty payments from streaming as they did from album sales – but they will. Let’s run through the mathematics.

            Spotify pays amongst the lowest royalties of any streaming music service, so let’s paint a picture based on their going rate – which is believed to be an average payout of $0.005 per song streamed.

            The average album on iTunes is priced at $9.99. So when I buy an album on iTunes I own those 12 songs forever and can play them as many times as I wish for $9.99. iTunes takes a 30% bite from that retail price while the remainder filters down to the label/artist. In short, I end up paying the label/artist $0.58 per song for lifetime use.

            So it becomes a question of whether it is better to be paid $0.58 for lifetime use of a song or to be paid $0.005 every time a song is streamed. In this case, lifetime use only equates to 116 streams.

            So anytime an individual streams a song more than 116 times, the label/artist will earn more from that person streaming the song than if they had bought it from iTunes. They may not receive that royalty in one lump sum, but they will earn it over time.

            We are witnessing a correction of the music business in favour of the consumer where labels/artist are being paid on a per-use basis. That’s fair.

          • Oh please

            Artists of all types from all genres have a problem with free streaming. I understand what you have written and I confess I don’t know as much about the whole. But when you can get democratic and republican, rich and poor, and ALL MANNER AND GENRE of music (pip,rap,country, classical, world, etc) together and they ALL have the same grievance, history has taught me to listen and to maybe come down on their side. They can’t all be lying. They can’t all be getting it wrong.

          • speakerboxtv

            I also appreciate your interpretation of the matter given the uproar from the artist community. For the record, if I was an artist, I would probably feel some type of way, too. It’s a big adjustment in how they accumulate royalties – but it certainly ISN’T UNFAIR. Music industry revenues are expected to show positive growth this year for the first time since 1998 – and that is directly attributed to the emergence of these streaming service. And that is a GOOD thing.

          • Ryan

            Got to agree with Oh please here speakerboxtv. The only room for artists complaints is with very poor payouts due to low ad income. You can’t hold up ad income up as a revenue stream relative to the sheer volume of plays as its abysmal.

            If you are however a paying subscriber to Spotify its a very fair share of the income and leaves no room for complaints by the artist. All services that are subscription only get no complaints or very few by the artists.

          • speakerboxtv

            We must also consider that the people using these freemium memberships are largely comprised of those who would otherwise be pirating music. As such, artists are now monetising a section of the market which has eluded them for the past 20 years.

            The freemium model is the most effective counter-piracy measure the music industry has produced thus far.

            But more to the point, please consider my post below, which breaks-down streaming royalty payouts (inclusive of freemium subscribers) and how it compares to purchasing a digital download.

  • That’s just great business…and marketing

    • jRocåmaroon

      You have said it better!! While the haters are hating, Jay Z’s winning.