Here’s why 1,500 YouTube views now equates to an ‘album’ in US sales awards

We’ll level with you.

Generally speaking, MBW is a bit concerned about the news that 1,500 streams on YouTube (or Spotify or Apple Music, Google Play etc.) in the US is now worth an album sale in the eyes of industry arbiter the RIAA for its Gold and Platinum sales awards.

Last year, we warned the music biz it “must be careful that it doesn’t encourage the disregard or dumbing down of the album – still very much its finest attribute”.

This seems a little like the first big step in the widespread manifestation of that worry.

We’re not alone.

Dangeroo Kipawaa, founder of the label home to Kendrick Lamar (pictured), Top Dawg Entertainment, yesterday called the RIAA changes ‘BS’, telling fans: “1 million albums sold is platinum. Until we reach that #, save all the congrats.”

But… that doesn’t mean the modernisation hasn’t been made without serious contemplation.

Or that the RIAA isn’t doing its best to ensure its Gold and Platinum Awards straddle two very different worlds: an album-based analogue past and the track-based digital future.

In this exclusive MBW blog, the RIAA’s EVP of Communications and Marketing, Jonathan Lamy, and its Director, Communications and Gold & Platinum Program, Liz Kennedy, explain their justification for the move – and what it might mean for artists and labels in the decades to come…

Why Now?  Why This Formula?

Like all fans, we cherish the concept of the album.  We all rightly celebrate the albums that reach the pinnacle of marketplace success.  The modern reality is that the way fans consume those albums has changed – drastically!  That’s why, when we started to develop a new formulation to better integrate streaming into the Gold & Platinum Album Awards last year, we identified a handful of overriding imperatives to guide our work.

First, we must adapt and be flexible.  Sitting on our laurels and gazing warmly at the status quo is not tenable.  Look no further than the past 15 years and the tumult exacted upon the music business to appreciate that point.  Second, our 58-year program must continue to recognize the very best of the best, the cream of the crop. 

Rewarding only quality and rare commercial success is essential. 

“It is well known by mbw readers that industry revenues have declined or remained flat even though consumption has increased dramatically.”

Third, our analysis and the determination of a formula must be based on comparative consumption patterns, not their marketplace value.  It is well known by the readers of MBW that music industry revenues have declined or remained flat even though consumption has increased dramatically. 

Inadequate monetization by music services is a serious challenge, but the program should reflect the demand and listening habits of music fans rather than today’s commercial revenues.  Lastly, we must preserve the integrity of the program.  We must ensure that our updates to the program do not dilute the significance of previous awards.

Album certifications are down precipitously during the last 10 years.  In 2005, the RIAA certified 479 albums.  In 2015, that number was 122 even while album listening and consumption through streaming is way up.

None of the decisions that went into creating the new 1500 streams / 10 tracks equivalency proportions were made lightly. Along with our label members, we sifted through reams of data on digital track and album downloads and all kinds of streams.

We also looked at certification levels for the past decade.  We found, for example, in 2005, 90% of the Top 200 Albums were eligible for an RIAA Album Award.  In 2014, that number was only around 30%.  Even with the new rules just announced, only about 40% would be eligible for a possible certification!  The threshold for a certification is still very high.

Let’s also not overlook some key criteria of any certification: external auditing company Gelfand, Rennert & Feldman reviews every submission to confirm that each award recipient has qualified based on a number of mandatory requirements, like requisite sales and streaming figures, demonstrated consumer demand, and much more. 

“None of the decisions that went into creating the new 1,500 streams / 10 tracks equivalency proportions were made lightly.”

Additionally, only on-demand streams requested by a user in the United States count.  And for videos, only official releases count – no user-generated content.

We hope everyone would agree that the 17 artists receiving inaugural awards are considered very successful.  Yet two-thirds of them had not yet been eligible for their first Gold or Platinum Album Award.  That surely can’t be right.

Change is hard.  We understand that.  Music has become a highly diversified business, with multiple revenue streams and multiple ways for fans to listen to their favorite songs and albums.  We have to find ways to recognize that collective activity, even if it may not always be perfectly elegant.  A Gold or Platinum album award is the result of demand for that artist’s work, just demonstrated in a different way than 25 or even 10 years ago.

We welcome the conversation and questions and feedback about the rule change.  It is gratifying that people care so deeply about the program and what it means.  As its custodians, and as guardians of its integrity, we do too.Music Business Worldwide

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