Smaller Pie, Bigger Slice?
“Target Corp. apparently doesn’t want to put a ring on it.
The Minneapolis-based retailer confirmed Tuesday that it will not sell the CD version of Beyoncé’s latest self-titled album because the pop superstar decided to release it on iTunes first.”
–“Target Says “No” to New Beyoncé Album“; The Star Tribune (12/18/2013)
What does one make of Beyoncé releasing her latest album directly on iTunes, bypassing (at least this time) retail outlets like Target?
She would rather have a bigger slice of a smaller revenue pie, than a smaller slice of a bigger pie.
Projected Sales & Net Income — Two Scenarios
So, assuming that Beyoncé sells 3 million albums at $15 apiece on iTunes and splits that with Apple, she’ll net something like $22.5 million.
Alternatively, if “bricks-and-mortar” retailers like Target remit only 20% to artists (my guess), Beyonce’s album would have to sell something like 7.5 million CD’s to net the same $22.5 million.
Looks like she put her money (literally) on Option #1.
P.S.: So have other entertainers like comedian Louis CK, who released a comedy album directly on the Internet last year.
