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U2, Apple and the Deal Behind Getting 'Songs of Innocence' Free of Charge

Wall Street Journal, September 09, 2014
By: John Jurgensen

 

A decade after releasing "How to Dismantle an Atomic Bomb," U2 was front and center in a presentation that could have been called "how to hype a new tech product."

Along with Apple's announcement of its latest-model iPhones and its new smartwatch, the company also revealed that it is giving away as many as 500 million copies of the veteran rock band's 13th album, "Songs of Innocence," via the iTunes Store.

Apple Chief Executive Tim Cook repeatedly described the album giveaway as "the biggest release in the history of music" -- probably an accurate description, given that no album may have ever been as widely distributed. The band has a long history with the tech giant: U2 cut a deal with Apple that led to a custom iPod model for the band, which came pre-loaded with "How to Dismantle an Atomic Bomb."

"Songs of Innocence" appears automatically on a user's "purchased" page in the iTunes store, requiring customers to simply click on it to download. As part of its deal with Apple, the band will also benefit from the kind of massive promotional blitz that few if any record companies today could afford.

The promotion highlights the way recorded music is often more valuable these days as a promotional tool than as a stand-alone product. The U2 album, which is exclusive to iTunes, iTunes Radio and Apple's Beats streaming music service for 25 days, will help jumpstart a concert tour likely to begin in 2015.  And the secrecy surrounding the announcement -- a hallmark of Apple's, of course -- shows how important the element of surprise has become for music acts trying to galvanize public attention.

Though the album is free for listeners, the band and its label, Universal Music Group, didn't just give their product away.

"We're not going in for the free music around here," Bono joked on stage.  Apple didn't pay a traditional wholesale price for each of the 500 million albums. Instead the company paid Universal and U2 an undisclosed lump sum for the exclusive window to distribute the album. Universal plans to piggyback on the big push for "Songs of Innocence" to promote the band's 12 older albums, a critical factor for a veteran rock band. The band's recent albums have shown a steady decline in sales even steeper than the overall industry trend. "No Line on the Horizon," from 2009, has sold 1.1 million copies in the U.S., according to Nielsen SoundScan. That's down from 3.3 million copies for "How to Dismantle an Atomic Bomb," and 4.4 million copies for "All That You Can't Leave Behind," released in 2000.

As part of the deal forged by the band, manager Guy Oseary (hired by U2 last year to replace longtime manager Paul McGuinness) and Universal, Apple also made plans to use the first single from the album, "The Miracle (of Joey Ramone)," as a central element of a global, 30-day television advertising campaign for its new iPhones and Apple Watch. The campaign is believed to be worth around $100 million, according to a person familiar with the talks.

On Oct. 14, the 11-song "Songs of Innocence" will be released (including a deluxe version with four additional tracks) through other physical and online retailers. The album was recorded in Dublin, London, New York and Los Angeles, and produced by Danger Mouse and other producers.

So far it's unclear whether the free album will qualify for the Billboard sales charts, or will be eligible for instant multi-platinum status with the Recording Industry Association of America. Because of the secrecy surrounding the deal, U2 did not consult with the RIAA in advance.

After Apple unveiled its iPhone 6 and Apple Watch Tuesday, U2 took the stage to perform "The Miracle (of Joey Ramone)," a bracing, fuzzed-out rocker. Some awkward banter with Cook followed. Bono joked about the band's halting progress on a follow-up to 2009's "No Line On the Horizon," saying that the band had made several albums since then -- "we just haven't released them." Then he joined hands with Cook and counted down to the release of the new album.

–Ethan Smith contributed to this article.

(c) Wall Street Journal, 2014.

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