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Company that tracks the weekly sales numbers for the U.S. music industry.

Based in White Plains, New York, the company tracks 85 percent of all retail music sales in the U.S. at its point of sale, including concerts, some 15,000 stores (including 600 independent retailers), and Web sites like CDNow or Amazon.com. Its data is taken from the retail outlets own cash registers, equipped with software to record the UPC code on the UPC labels of the CDs being sold. The data is turned into reports that can break down how many units of a particular title were sold in a particular city, what type of store the title was sold in (chain store, independent, mass merchant, nontraditional), as also determine to the top selling 50 albums for the past week, broken down by label (who pay a fee based on how deep a level of data they want).

Since March 1, 1991, Billboard magazine charts have been constructed directly from SoundScan data. MTV, VH1, CMT, et cetera use the data. Soundscan ranks the 20 Most Popular Albums and 20 Most Popular Singles in the U.S. It also ranks the Top10 in Rap, Rhythm & Blues, Country-Western, Extended Play Singles, albums by New Artists, Hard Rock, Metal, Classical and Jazz albums.

Repercussions of getting more accurate sales figures:

  • IIRC, hip-hop records, which had received little mainstream airplay in many markets, suddenly started appearing on Billboard lists in 1991, and soon became mainstream for suburban teens.
  • Independent bands, if they registered a UPC code with Soundscan, could track their sales, and use the data to leverage contracts with record labels and promoters. More importantly, if they worked with a distributor, they could verify they were getting paid fairly.
  • Chain stores like Wal-Mart or Best Buy, who don't specialize in music but stock CDs anyway, can put the appropriate numbers of country, hip-hop, rock, pop, gospel, Hispanic, etc., being sold in their market-- based on the shared info from all the retailers in their market (which means the work of knowledgeable staff at small, independent music stores who know what's "in" ends up filling the shelves at their competitors. Boston based independent music store owner Mike Reese pulled out of Soundscan reporting for just such a reason. )
  • It is possible to verify whether or not Napster is cutting into CD sales. (Sorry, RIAA, it wasn't. And sorry, Napster fans, your backlash against Metallica and Dr. Dre didn't hurt their sales either).
Media company VNU of the Netherlands will soon release Bookscan to do the same to the book industry.

Sources: www.business2.com; www.plastic.com/altculture; www.latimes.com
Tim Sweeney, "The Importance Of Soundscan For An Independent Artist," http://www.aandronline.com/reading-room/soundscan.html
Thea Singer, "Sharer Beware," Inc. Magazine , March 1, 1999, http://fnookie.inc.com/articles/details/0,3532,ART4559_CNT56_REG3,00.html

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