What Will Billboard’s New Streaming Rules Really Mean?

Rap has dominated the Hot 100 this year. Five hip-hop tracks have taken the Number One spot, tying a chart record, and in April, rap singles single-handedly accounted for half of the Top 10. It’s also been a banner year for Latin pop ”“ Luis Fonsi and Daddy Yankee’s “Despacito” tied the record for the most weeks spent at Number One (16), and when J. Balvin and Willy William’s “Mi Gente” flew to Number Three, it marked the first time ever that two non-English-language tracks held spots in the Top 10 simultaneously.

But all this could change next year, due to a shift in the way Billboard plans to track its charts. The Hot 100 has three components ”“ sales, radio play and streaming ”“ and starting in 2018,Billboard will give more weight to streams from platforms that listeners pay for, discounting the impacts of YouTube, the largest music-streaming site in the world, and the free (or ad-supported) tier of Spotify. Paid streams will also count more on the Billboard 200, which tracks the most popular albums in the country each week.

Billboard has not yet announced the size of the differential weighting, which will determine the extent to which these new rules impact songs that gain favor on free platforms. But the new system is likely to affect certain genres more than others: Nine of the 10 most viewed YouTube videos in the U.S. in the last 30 days were hip-hop or Latin pop records, and nine of the 10 most viewed artists on YouTube last month work predominantly in hip-hop, R&B or Latin pop.

For Jeff Vaughn ”“ who has worked with Kevin Gates, Young Thug and Kehlani as Vice President of A&R at Artist Partners Group, a joint venture with Atlantic Records ”“ the question is not whether rap singles will have less impact on the charts; it’s how drastic the drop will be. “Five years ago, you never saw a rap record in the Top 40; this year you see them regularly in the Top 10, and not manufactured crossover records, but cultural songs,” he says. “I have to assume we will see less of that.”

The decision to up-weight paid streams is just the latest in a series of changes to the charts that Billboard has initiated in the last five years as it attempts to grapple with an increasingly complicated task in the streaming era. (I also contribute to Billboard.) “It’s how you balance two sides of the equation: One side is recognizing the revenue for artists; the other side ends up being demand or popularity from the consumer point of view,” says Ryan Redington, Director of Amazon Music, which has paid streaming that counts toward the Billboard charts. In the old days, the revenue side and the popularity side were effectively equivalent, because to hear a song, a listener either bought a CD or turned to easily monitored outlets like radio and MTV.

That is no longer the case. “How you measure the biggest has become very, very complicated,” says Matthew Adell, former CEO of the online dance-music store Beatport. “Do people spend money on it is one way. Do people spend time with it is another way.” As a result, there’s a rift between the music industry, which wants to know what’s keeping the lights on, and listeners, who want to know what’s turning their friends on.

Apple Music believes the charts should be revenue-focused. “Billboard could have a free chart if they want,” says Apple Music head Jimmy Iovine, “but the chart that people argue for, that they strive to be Number One on, has to be a real chart.” Otherwise, he continues, “they’re mixing ”“ no pun intended ”“ apples and oranges.”

Others aren’t so sure. “I’m a label guy, I get the need for money,” Vaughn says. “But at the same time, I just don’t like the idea of people not being able to listen the music where they want to listen to the music, or if they choose to listen to it there, then it not being counted properly and reflecting the artist’s popularity and the song’s quality.”

Billboard‘s attempts to satisfy both parties with a single metric began in 2012, when it incorporated streaming data into the Hot 100 for the first time. In 2013, the company also added YouTube to its Hot 100 accounting. The next year, streams began to count toward the album chart, with 1,500 streams from select services ”“ including Spotify and the Apple Music predecessor Beats Music, but not YouTube ”“ serving as the equivalent of a single album purchase.

Each change to the accounting system has created some winners. Taylor Swift was a notable beneficiary of the initial decision to add streaming data to the charts; the inclusion of Pandora’s numbers this past January helped Rihanna’s single “Sex With Me.” Less lucky were artists who perform well on radio but don’t necessarily stream a lot, a group that includes many country artists and R&B singers. But in general, these changes suggested a more inclusive pop world, and the Billboard charts better reflected the music the majority of listeners were actually spending time with ”“ even if, as is increasingly common, listeners were not spending money on that music.

There is widespread concern in the music industry that some of the free streaming services can be manipulated in ways that artificially inflate a song’s streams. Photo: Pixabay

The latest rule change, if not entirely a step in the opposite direction, is more complicated, distorted by the music industry’s dislike of free services and its ongoing feud with YouTube. YouTube helps create intercontinental hits and reaches a massive number of listeners ”“ the platform claims 1.5 billion logged-in users a month around the globe ”“ with an emphasis on the all-important young listeners, who dictate the direction of pop music. But the platform pays famously paltry royalties: A recent report from the Recording Industry Association of America suggested that Apple pays an artist between $12 and $15 per 1,000 streams, while Spotify pays roughly $7 and YouTube pays approximately $1. YouTube also relies on the shelter of the 1998 Digital Millennium Copyright Act to allow users to post content that they don’t own the rights to.

In addition, there is widespread concern in the music industry that some of the free streaming services can be manipulated in ways that artificially inflate a song’s streams. “SoundCloud and YouTube are a lot easier to game,” says Nima Etminan, Vice President of Empire, a distribution company and record label that helped turn Fat Joe and Remy Ma’s “All the Way Up” and XXXtentacion’s “Jocelyn Flores” into hits.

Matt Harmon, general manager of Beggars Group, which includes a number of independent, rock-focused labels, agrees. “You don’t have a very good view on what’s happening [on YouTube],” he explains. “If at the end of the week, a number [of views] appears, how do you count it up? Is it a full song or not a full song? [The label Republic recently posted a video of Post Malone’s “Rockstar” that only contained a loop of the chorus; the clip subsequently accumulated millions of views.] Who put it up? It’s more than chaotic.” (It’s worth noting here that other streaming services are not immune to manipulation: Since they have little transparency, they are often free to pick their own winners and losers, as long as they don’t upset the major labels.)

Iovine pushes Harmon’s argument further. “What you don’t want is people leaning on a button that gets hundred of millions of streams and all of a sudden we’re back to the old days, when you give somebody a shoulder bag, and they give you a Number One record,” he says. “A movie box office isn’t based on how many people saw the trailer,” Iovine adds. “It’s absurd. It’s nonsensical.”

In a statement, a YouTube spokeswoman noted, “Billboard transformed the industry by recognizing YouTube is where music is discovered, hits are created and music pop culture is made. Unfortunately, with these changes, Billboard is essentially saying the only music fans that count are those with credit cards.”

Iovine, in contrast, prefers to talk about musicians rather than listeners. “Artists should be able to put their music wherever they want if it’s in the interest of them and their partners,” he tells Rolling Stone. “But to be forced to put their music on certain platforms in order to get a better chart position is unfair and, dare I say, fake news. It only allows free services to take advantage of artists ”“ the lifeblood of what we do.”

The impact of the new weighting system is hard to determine without knowing the size of the weight, and since Billboard does not make the consumption numbers that determine chart placement publicly available ”“ it only reveals the relative position of singles and albums ”“ attempts to calculate the new rules’ effect are difficult. But it’s easy to imagine that one particularly susceptible group of songs will be viral dance records like “Juju on That Beat” by Zay Hilfigerrr and Zayion McCall, an act that Vaughn signed to Atlantic Records before the song went to Number Five on the Hot 100. “Juju on That Beat” was being streamed roughly 20 million times a week when it climbed into the Top 10, and Vaughn estimates that approximately 80 percent of those streams came from YouTube. Under the new regime, the chart position of a song that has a lower ratio of paid to unpaid streams will suffer relative to a single with a higher ratio, all else equal.

At Rolling Stone‘s request, Amir Kashani, Head of Strategy at LVRN ”“ a creative agency and label that has D.R.A.M., 6lack and Raury on its roster ”“ and Dan Feldstein, who co-founded the media consulting company Salt + Vinegar with Kashani, performed an estimate of the impact that Billboard’s new rules would have on D.R.A.M.’s “Broccoli,” a streaming-heavy Top 10 crossover hit from 2016, using a few hypothetical weights. “When ‘Broccoli’ was peaking, 64 percent of streams came from ad-supported channels, especially YouTube,” Kashani says. “If ad-supported streams counted less than paid streams, that could have negatively impacted ‘Broccoli”s chart position.”

Justin “Meezy” Williams, whose company Meezy Entertainment manages the rapper 21 Savage (who has racked up 37.8 million views on his “Bank Account” in the past month alone), suggests that the new rules are part of a backlash against hip-hop’s chart success. “Right now, if it’s not us [scoring hits], it’s Cardi B; it’s Rae Sremmurd; it’s Migos,” he says. “We run the whole thing. They don’t like this shit.” A major label official disputes that characterization, contending that rappers and R&B singers still stand to benefit from the new rules, since their streaming audiences continue to grow rapidly.

In a statement announcing its rule changes, Billboard said that it also considered including YouTube streams in album standings for the first time, ultimately deciding against it. As a result, shifts on the Billboard 200 may be less jarring, because without counting YouTube, every act’s ratio of paid to unpaid streams goes up.

But some artists are still likely to see their stock improve on the albums chart under the new rules. Harmon of Beggars Group expects that his roster’s impact will be magnified. “We don’t typically have artists that compete on the singles chart; we tend to perform better on the premium services,” he says. “I think that we will benefit from premium plays being weighted heavier.”

Two of the biggest winners aren’t artists at all: Apple Music and Amazon Music lag behind YouTube and Spotify in terms of users, but they do not have a free tier, so all their streams are now worth more. “If they’re decreasing the impact of Spotify and the impact of YouTube, that means by default the other players matter more in the ecosystem and will be more competitive,” says Feldstein.

A still from Cardi B’s record-breaking “Bodak Yellow.”

Does chart placement matter? Is it just a snapshot of consumption ”“ with a bias, in 2018, towards revenue-maximizing consumption ”“ at any given moment without wider-reaching consequences? Or does it feed back into the music ecosystem, affecting artists’ livelihood and the musical horizons of millions of casual listeners?

It seems fair to expect that a rule change like this will have consequences that ripple beyond the charts, even if a listener isn’t consulting the Hot 100 every week to determine what to stream. “If you’re going to be looking at the effects of any type of correction, you must look at it holistically,” says Kashani. “We look at streaming numbers as more than just revenue; we look at that as marketing.”

Buzz from streaming also helps songs gain momentum on tour and on radio; it’s not clear how lower chart placement might lessen those effects. “Distribution strategies and marketing strategies will be affected by these corrections,” Kashani adds. And if the relative clout of Apple Music and Amazon Music increases, that will surely have repercussions as well. “When every music platform is chasing relationships with talent, this might change some of those conversations,” Feldstein notes.

From the consumers’ perspective, the danger of the new chart rules is that instead of measuring listening, they measure different kinds of listeners and discount the preferences of some of them: The listenership on YouTube, for example, skews towards younger listeners. “I’m not that worried about that,” counters Apple Music’s Robert Kondrk. “If you go look at Apple Music and look at our charts, I think it screams usage by young kids.”

“To think that a chart is going to affect a customer, except if you’re Number One, is pretty naive,” Iovine adds. “How many millennials do you think read Billboard? That’s a specious argument.”

In one sense he’s right: Both artists and listeners will almost certainly continue to use free streaming services. “[YouTube]’s the best way to reach young fans,” Vaughn of Artists Partners Group says. “As we moved from Twitter to Instagram to Stories, which is all video, it feels like YouTube is perfectly positioned, and that video will be more important than ever.”

Similarly, when asked how the change in chart accounting will impact his job, Williams, offers the verbal equivalent of a shrug. “It ain’t gonna stop nothing on our end,” he says. “At the end of the day, if you’re hot, you’re hot.”

But will the new Hot 100 and Billboard 200 reflect that heat?