The figure marked the best first-week album sales since 50 Cent's “The Massacre” sold 1,141,000 copies in 2005.
But what was unusual was that Lady Gaga’s total was fueled by digital downloads – a high percentage of which were sold for less than individual songs from the album.
Last week, retailer Amazon.com raised eyebrows when it set the price for a download of the 14-track album at 99 cents on its May 23 release day, representing an unprecented low bargain-price discount for a marquee release. iTunes was selling a download of the album for $11.99.
Though Amazon only sold the album at that price for two days, Billboard estimated that it sold more than 440,000 albums at that price, and Nielsen SoundScan reports that overall digital sales among all retailers accounted for 60% of the first week sales of “Born This Way.”
Though the firm doesn’t break out the 662,000 downloads sold by retailer, a look at some recent major releases can put Lady Gaga’s digital sales in perspective. When Taylor Swift’s Big Machine album “Speak Now” bowed at No. 1 in November 2010 with more than 1 million copies sold, only 27% came from the digital sector. Likewise, for Eminem’s Interscope album “Recovery,” which debuted in June 2010 with more than 740,000 copies in its first week, only 34% of that tally came from the digital sector.
“Recovery” was the best-selling digital album of 2010, selling 852,000 downloads over a six-month period. The second-best selling digital album of 2010 was “Speak Now,” with 488,000 downloads.
Executives at Universal Music Group, which distributes the Gaga album, could not be reached for comment. Additionally, calls to Amazon were unreturned.
Labels, however, cannot dictate the price at which Amazon sells an album. As with past Amazon promotions, the retailer sold “Born This Way” as a loss-leader, paying full wholesale price for the album. The industry trade magazine Billboard, which publishes the U.S. pop chart, noted that Amazon paid $8.40 for each digital copy it sold, and estimated that Amazon sold more than 440,000 downloads at the 99-cent price.
More traditional retailers have become used to such tactics. Eric Levin, who heads indie retail consortium the Association of Independent Media Stores, simply noted that for the consumer, “owning the highest resolution recording for around $9.99, that you own in perpetuity and have the right to re-sell, is a better bargain in the long run.”
First-week digital discounts last year propelled indie rockers the Arcade Fire to the top of the pop charts when Amazon set the price of the act’s Grammy-winning album “The Suburbs” at $3.99. At the time, Laura Balance, co-owner of the act’s label Merge Records, said, “I find the resistance I had five years ago to music getting cheap is being broken down over the years by relentless pressure. People want to pay less.”
Yet Lady Gaga’s 99-cent sale was more striking in that individual tracks from the album were being sold at $1.29 at Apple’s iTunes store. The album’s self-titled single, for instance, has sold more than 4.2 million copies, many of them at $1.29, according to SoundScan data.
Amazon wasn’t shy about its reasoning, putting out a press release that touted the promotion and the fact that the purchase of the album came with a free 20 gigs of storage for Amazon’s Cloud Drive, which allows users to store and playback their music via the Web and in the form of an app for Google Android phones and tablets. The company even touted that it was not able to meet demand for the 99-cent album, as many customers had difficulty downloading the album on its release day.
“Clearly customers are really excited for Lady Gaga's new album -- we saw extraordinary response to Monday's promotion -- far above what we expected -- she definitely melted some servers,” Craig Pape, director of music for Amazon, said in a statement.
Some questioned whether Billboard should factor the 99-cent downloads into its chart, forcing editorial director Bill Werde to post an online editorial defending the trade’s decision not to revise its policies.
Wrote Werde,”Who's to say that in three years or three months or even three weeks that the accepted value of an album won't be 99 cents? I realize that's an alarming (and unlikely, at least in weeks or months) thought.… But the decline in the perceived value of recorded music is not exactly a secret in 2011.”
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