Def Jam Freezing Out iTunes

In a move that surprised the record industry, Island Def Jam withheld R&B crooner Ne-Yo's massive radio hit "So Sick" from iTunes, and all other digital services, until his debut CD came out last month. The strategy -- which flies in the face of conventional wisdom that releasing a single online before an album comes out boosts sales -- seems to have paid off big: According to Nielsen SoundScan, the singer sold 301,000 copies of In My Own Words in its first week, making it the year's biggest debut. And, as a bonus, Ne-Yo moved 120,000 copies of "So Sick" online.

Ne-Yo's chart-crushing success is already changing the way labels look at the iTunes singles market. In the weeks after his debut, new songs by artists including T.I., Shakira and Rihanna were also withheld. "Everybody's going to do it because they saw that it worked," says Tina Davis, manager of hit R&B singer Chris Brown and a former Def Jam executive who signed Ne-Yo in 2004."Everybody's trying to find a new strategy."

Island Def Jam's move cuts to the heart of a music-industry debate: Do advance singles create buzz, or do they cannibalize CD sales? Brown released his hit radio single "Run It!" online more than three months before his album came out in 2005, selling more than 300,000 downloads. But when his album hit shelves, it sold just 154,000 copies in its first week -- about half of Ne-Yo's numbers. (Competitors point out that some major CD outlets sold In My Own Words for $7.98.)