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Record Sales Inflation Scheme

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I ws just telling someone that Soundscan largely solved the significant problem of falsified sales figures for chart position, and then this turns up:

    Independent music retailers are fabricating numbers reported to Nielsen Soundscan, inflating the number of albums sold by music labels such as white-hot Island Def Jam, The Post has learned.
    It’s not clear who is behind the scheme, which involves shipping boxes of albums for free to some independent retailers, according to well-placed sources.

    The retailers reap all the profits from the sale of the extra albums, and in exchange report bogus figures to Nielsen Soundscan, the standard reporting agency for the record industry, the sources say.

    The record labels do not receive any income from the sale of the albums shipped free, nor do they profit directly from the bogus figures reported to Soundscan.

    Labels could benefit from the bogus numbers, however, if they served to propel a record up the charts, boosting radio play and sales. Industry sources say Nielsen Soundscan numbers are typically factored into bonuses. But a spokesperson for Universal, the parent of Island Def Jam, said its executive compensation is not linked to the numbers and never has been.

This sounds like a darn fine deal for the retailers: free goods for overreporting – why not?

    In one example of the sales inflation, an indie retailer in the Southeast recently reported to Nielsen Soundscan that it had sold roughly 3,000 percent more copies of Jay-Z’s new album, “Blueprint 2″ – an Island Def Jam release – than it actually did, according to sources both at the retail level and close to Universal.

    The scheme was verified by another indie retailer in the Southeast, which typically reports to Nielsen Soundscan triple the amount actually sold. For example, this store sold roughly 50 copies of Jay-Z’s album recently, but scanned 150 for Nielsen Soundscan.

    This source says the practice has been ongoing for about three years, and is not limited to Island Def Jam releases.

Someone somewhere is gaining something concrete we aren’t hearing about here. Something is missing for the picture – we don’t know the whole motive yet.

Fine reporting by by Tom Arango in the NY Post nonetheless.

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About Eric Olsen

  • jonathan mckinney aka kidkrakk,thegreatness

    jay-z is the god of rap no one fuckn’ wit him even his latest shit iz reckon halff of the shit most rappers put out. and evevn if it aint the hottest shit he can spit itz still gon sell.

  • someone else

    huh?

  • Bryan

    Thanks for posting this. I can tell you what the motive and the reward is. If you go to the RIAA headquarters (The people who give Platinum and Gold certificates to artists) You will see that the board of directors is made up of the Entertainment companys who own the record labels involved in this scam. Sony/BMG are the major shareholders having 4 representatives on the board. They own all the American Idol record Labels such as Arista, Jrecords etc. Warner and Universal make up three representatives each on the RIAA board. They own several current record labels. If you go to the HDD charts every week you will see that these companies artists stay in the top 40 continuously. JT,Nickleback,Daughtry, Carrie Underwood have all been in the top 40 longer than any of the other artists. The supposedly HIGH sales figures this scam is generating for these artists is giving the RIAA ‘Board of Directors cum Record Companys the high numbers they need in order to grant themselves Platinum certificates. Clever isn’t it? It’s a shame that all those poor single record labels who pay their fees to be members of the RIAA do not benefit in any way at all. The greedy RIAA will always push these people down and not one of them is financially secure enough to fight this situation… so it continues. I do hope one day someone will ‘OUT’ these greedy people and we can go back to fair sales reporting.

    If you go to this link it will give you the name of the Record Companys involved if you scroll to the bottom of the page.

    here also is a link to the Board of Directors of the RIAA and the main shareholders being Sony/BMG, Universal and Warner.