Women in Music 2016

Beyonce, Drake and the 'Exclusives' Explosion: How Streaming Has Changed the Way Albums Are Released

In November 2014, Larry Jackson, then a new Apple executive, sat down for dinner at Soho House in West Hollywood, Calif., with Drake’s ­co-manager Adel “Future the Prince” Nur and started an argument. Drake hits like "0-100/The Catch Up" and “Draft Day” had been floating around the Internet for free, and Jackson wanted to collect them on the tech giant’s upcoming streaming service. “I was aggressive and ­abrasive,” recalls Jackson. "I said, 'Man, why do you put your music all over? I just don't understand.'" Working with Drake's labels, Republic and Cash Money, they hatched a plan leading to Apple Music’s Views exclusive on April 29.

Apple spent a reported $19 ­million on the Drake deal and gave him numerous ­marketing ­opportunities: He spoke at the Apple Music announcement in June 2015 and appeared ­regularly on his OVOSOUND station on Apple Music's Beats 1 in the run-up to the first-week exclusive. And in a year when the biggest stars, ­including Beyoncé, Kanye West, Rihanna, Chance the Rapper and Radiohead, have used Apple, Tidal and their own websites to radically reinvent the process of releasing albums, Views -- Drake’s newest set, released April 29 -- moved 1.04 million album­-equivalent units in its first week, according to Nielsen Music, ­including 852,000 sales.

“It’s not even about ‘the get’ in terms of the exclusive,” says Jackson. “It’s the idea around it. “I look at it as working with people I respect on a creative level, and hopefully we can do something smart and bespoke and combustible.”

For decades, album releases were rigid and traditional: Artists and labels picked a Tuesday launch date and built up to it with a ­marketing campaign involving radio, TV and press in an effort to maximize first-week sales figures. But throughout 2016, superstar artists and music streaming companies have been obliterating that model, reinventing the way albums are released -- some without a snag, others full of glitches and flip-flops. These aren’t cult acts trying to make themselves heard, they’re A-listers ­choosing new paths, unsure whether they’ll sell ­millions or potentially cripple their career. Views was a deft ­marketing ­collaboration with the world’s biggest technology ­company; Beyonce’s April 22 Lemonade launch arrived alongside an hour-long HBO video album; West’s run-up to The Life of Pablo included a Feb. 11 Yeezy Adidas event at Madison Square Garden in New York -- complete with performance artists, models and Kardashians -- streamed online in real time; and Rihanna’s Anti was backed by a $25 million Samsung sponsorship deal.

This fundamental shift in strategy has happened, in broad terms, because of the ongoing transition from owning music to renting it. Streaming clearly represents the future, but for now, artists frustrated with their minuscule royalty payments have turned to tech giants for big-time ­marketing dollars for video or tour ­funding, even if it means their music is limited to users of just one service. And labels, which lack the bottomless ad budgets of Apple and Samsung, are often the beneficiaries of these kinds of money grabs. “If you look at what’s happening in the film and TV world with Amazon and Netflix and Apple, there’s an incredible war over good content,” says a major-label source. “We're in a very good position that way. It’s going to escalate in the short term.”


“It’s a shift in the business,” adds Alex Luke, a former EMI and Apple executive who’s now a Valley Fund venture capitalist. “There’s a sea of tweets and photos every day, and one of the few things that cuts out the noise is the day of release -- and surprise and exclusivity amplify it.”

Almost all of these customized releases involve a partnership with one of the music-streaming rivals that are ­competing fiercely to expand their user bases and draw closer to industry leader Spotify’s 30 million paid subscribers (and 89 ­million users overall). Jay Z’s Tidal has just 3 ­million subscribers, but it has 20 music stars as co-owners, all of whom have a financial stake in building up the company, possibly for a future sale. Thus, while West flirted briefly with Apple Music, Pablo was initially a Tidal exclusive, as was Rihanna’s Anti, which arrived Jan. 28. "There's no doubt that exclusives are becoming an important part of how streaming services differentiate, and it's helpful to Tidal to have direct access to some of the biggest names," says Mark Mulligan, a music-business analyst for Midia Research.



Apple Music has 13 million ­subscribers, and the hardware-focused company has struggled to make its cloud-based interface as elegant and glitch-free as that of rival Spotify. (The company plans to announce a redesign at its annual Worldwide Developers Conference June 13-17, ­according to reports.) The service’s X-factor may be its ­management, which includes Jackson, Dr. Dre and Jimmy Iovine, the former Interscope Records chief who ­specializes in big-money artist ­partnerships. The company helped fund videos by The Weeknd and M.I.A. and a concert film by Taylor Swift, and made exclusive-album deals with Chance the Rapper and Future. Apple reps wouldn’t discuss specifics, but the deals often involve online marketing as well as TV ads. Spotify has sat out the ­exclusivity boom completely, in part because of its lead over the competition, in part because it loses money each year and can't match Apple's resources, and also because it allows users of its ad-supported platform to stream all content for free.

"Exclusives are good for a short marketing boost, but they're not a long-term attention tool," says Aram Sinnreich, an American University media professor and music-business analyst. And as retailers such as Walmart and Target have discovered through decades of CD exclusives, the approach isn’t as easy as picking a surprise date and a ­streaming ­service. West’s Tidal release was as bumpy as any in memory, with the mercurial ­rapper calling it a work-in-progress, ­remixing and rerecording tracks after release and ­making Twitter pronouncements such as “you can only get it on Tidal” before reversing course and releasing it to most streaming services within six weeks. Similarly, Rihanna fussed with Anti all the way up to its oft-postponed release, finally issuing it as a brief Tidal exclusive after a late-January leak. Such complicated rollouts suggest the record business had logistical reasons for picking old-school release dates and drawing up advance deadlines to accommodate them. "That whole notion of this being a living work of art was a bit of a post-rationalization for what turned out to be an extremely messy rollout," a music-business source says of Pablo. Another source adds, "I wouldn't point to those [West and Rihanna exclusives] as successful ways of leveraging those platforms at all.”

By contrast, Beyoncé did just about everything right with Lemonade -- Tidal claims it generated 1.2 million new ­sign-ups (reps wouldn’t say how many of those wound up as paid ­subscribers), and the album racked up 485,000 sales and 115,000 streams in its first week. (She also broke Justin Bieber's one-week streaming record, with 115.2 million compared to 100.4 million for his Purpose late last year, and with Drake recently becoming Spotify's most-streamed artist, Bieber has been usurped as the Prince of Streaming.)

"On Beyonce, the story was, 'This was flawlessly done, now let's talk about the music and the video and what Beyonce's saying,'" says Jack Isquith, a former Warner Bros. Records digital executive who is now Slacker Radio's senior vice president of content and programming. "There was so much messiness around Rihanna and Kanye that the story became more about the messiness and the exclusives, not the music."

Labels are often caught in the middle between an artist and an Apple Music or a Tidal. A major-label source complains that streaming services have tried to woo ­superstar artists by promising ­funding outside the realm of the recording ­contract, with tours or videos: “The only way we'd do it is if they want to contribute money to the video and we own the content. But we're not going to put ourselves in a position that they’re funding content, that they own, for our ­artist.” But mostly, label executives say they’re pleased to be sharing in the ­payments and marketing from ­streaming services. “Obviously there’s fierce ­competition going on among the platforms. When you’re an artist or a label, you can use that to your advantage to turn up the heat and excitement around the release,” says Tom Corson, president/COO of RCA Records, which worked with Apple Music on a one-week exclusive for singer-rapper Bryson Tiller’s 2016 debut, Trapsoul, selling 24,000 copies in its first week. "It's mutually advantageous for the services and labels and artists."

“I don’t think they’re going to stop, because Apple thinks it’s got an ­advantage with Jimmy to get these things, and Tidal thinks it’s got an advantage because they’ve got all these [artist] partners,” adds Jim Urie, the recently retired Universal Music president who heads new streaming service CÜR Music. “If you’re big enough [as an artist] to command that over-the-top marketing, it’s great.”

Reps for Tidal, Spotify and the artists in question, including Beyoncé, Rihanna, West and Radiohead, were unavailable for comment.

For consumers, the streaming ­exclusives can make for costly digital whiplash. Fans who ponied up $10 per month for a Tidal subscription to stream Pablo or Lemonade suddenly had to subscribe to Apple Music in order to get Views or Chance the Rapper’s Coloring Book. Plus, the paid subscription services don’t make it easy to cancel subscriptions after the free trial periods. "If you're forcing people to sign up and give information, I'm not a big fan of that," says John Peets, manager of Black Keys and Eric Church, who put out Mr. Misunderstood as a surprise physical-album exclusive to fan-club members in December. "You should minimize the amount of hoops you should make a fan jump through."

Those hurdles can lead fans to the scourge that spawned Spotify in the first place: illegal piracy. Within hours of release, Lemonade and Pablo both surged to the top of the MP3-downloading charts for ­Kick-Ass Torrents and The Pirate Bay; the latter service estimated that Pablo was illegally downloaded 500,000 times in 24 hours. "Exclusive" albums like Coloring Book quickly turn up on YouTube, festooned with L'Oreal spots and other advertisements in the middle of songs, or shadier services. “Record labels have tried to figure out how to window online for the last 20 years,” says Larry Kenswil, an attorney and a former Universal Music executive. “But copying and sharing has made it impossible for that to be effective.”

Will every major artist with a new release opt for the stunt-exclusive, or is it just a fad, like video discs or Best Buy deluxe editions? “The statement used to be, ‘Look at all this hype -- the big show is coming!’ After years of doing that, people become numb,” says Tim Smith, manager of Skrillex, who put out 2014’s Recess as a surprise. “But if everybody’s doing ­surprise releases, then that’s not very ­exciting, either.” 

A version of this article first appeared in the June 4 issue of Billboard.