Why Adele Isn't Streaming Her New Album on Spotify or Apple

Betting On Artists Wide Appeal

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Adele performs in Chicago at Park West in January, 2009.
Adele performs in Chicago at Park West in January, 2009. Credit: Christopher Macsurak via Flickr

By restricting her new album "25" from streaming services Apple Music and Spotify, Adele is playing to her greatest strength: wide appeal.

The British singer is the rare artist whose allure spans demographic groups, from teenagers on YouTube and Spotify to adults who visit record stores or frequent iTunes. Music executives liken her to a four-quadrant movie, the lingo for blockbusters like "The Avengers" and "Jurassic World" that draw in young and old, men and women.

Adele and Sony's music division are betting customers of all ages will want her album so much that they'll show up at record stores and on iTunes to buy a copy in bigger numbers than ever before. Music purchases deliver more profit to the artist and the label than streaming services do. First-week projections for "25" range as high as 2.5 million units, which would be the biggest opening since Nielsen began tracking album sales in 1991. It's $10.99 for a pre-order on Apple's iTunes.

"Adele is a one in a million artist and she is fully driving her own career and fan base," said Vickie Nauman, a Los Angeles-based media consultant who's worked with Sony Music and Beggars Group, which includes Adele's label, XL Recordings.

Adele has tangled with Spotify before over free music. She initially withheld her album "21" because the service refused to limit the songs to paying subscribers. Taylor Swift did the same thing last year with "1989," though she did allow the album to stream on Apple Music after the service's debut.

"We love and respect Adele, as do her 24 million fans on Spotify," Spotify said Thursday in an e-mailed statement. "We hope that she will give those fans the opportunity to enjoy '25' on Spotify alongside '19' and '21' very soon."

Web-radio pioneer Pandora Media, which operates under different rules than its streaming rivals, will have access to the album and offer it to its customers within a few days.

"Pandora is looking forward to playing music from Adele's new album soon after it drops," the company said in a statement.

Retailers had plenty of access. Target is promoting an exclusive version of '25' with three extra songs.

It's easy to see why they all want stars like Adele, whose surname is Adkins. The U.K. singer's last album has sold more than 11 million copies in the U.S., reaching that mark faster than any artist in more than a decade. Ms. Swift scored the biggest week of sales in 12 years with "1989."

Unlike Ms. Swift, who is most popular among younger listeners, Adele receives a big boost from older consumers. More adults bought albums online and in stores in 2011 thanks to Adele's "21," according to Russ Crupnick, an analyst with MusicWatch.

Mr. Crupnick credits Adele with temporarily arresting the decline in U.S. album sales overall. After U.S. music industry sales fell 11% in 2010, they rose less than 1% in 2011 before resuming their slide.

"We called it 'the Adele factor,'" Mr. Crupnick said in an interview. "Adele singlehandedly helped change the trajectory."

Still, it's a risk to shut out streaming. These newer services have emerged as a major source of revenue in the years since 2011, when they accounted for about 10%. In the first half of 2015, online streaming grew to 32% of all music sales in the U.S., making up for shrinking purchases of CDs and digital singles, according to a report from the Recording Industry Association of America.

That growth explains why some analysts and executives question Adele's decision to limit access to her album. The album's hit single "Hello," which is available on Spotify, is already near the top of the charts, and the video for the song was viewed more than 400 million times on YouTube in less than a month.

Blessed with a surefire hit, record industry executives keep to a simple mantra: don't mess with the fans.

"It is so primed for a successful debut, you don't want to play games" said Ted Cohen, managing director of TAG Strategic, a digital entertainment consultant whose clients include Sony/ATV Music Publishing. "Someone will say, 'We're not streaming the record; you have to buy it,' and it'll p--- a lot of fans off. I don't think anyone has shown you sell more physical copies because you kept it off a service."

The growth of streaming services hasn't stopped the world's most popular artists from spurning them when releasing new albums. A stream still isn't as valuable as a sale, and a single song's popularity on YouTube and Spotify can indicate that a song is a hit. Fans of Beyonce and Adele can always stream albums later, once the sales have slowed.

"Increasingly many artists are releasing music in cadences, so that they can get the most financially out of their new material," said Ms. Nauman, the consultant. "I imagine Adele will continue to have hard core fans who will buy the CD and she stands to make much more from that."

-- Bloomberg News

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