RICK KARR: This is On the Media. I'm Rick Karr. Every documentary about a musician or episode of VH1’s Behind the Music has that shot in it. You know the one I'm talking about. You hear about the band’s breakout success while the camera shoots up a music chart and finally rests at their hit song, “Number three, with a bullet!” The chart you’re seeing is probably Billboard’s iconic Hot 100. It’s a monument to stardom that’s starting to crumble. That’s because it measures radio airplay and record sales when a lot fewer people are listening to radio and buying records than in the early days of the charts. Yes, the Hot 100 does include data from the AOL and Yahoo! streaming services, but that makes up just 3 percent of its data. OTM producer Mark Phillips charts the chart’s struggle for relevance in the turbulent music ecosystem.

MARK PHILLIPS: Billboard created the Hot 100 in 1958, by combining record sales and radio plays, to come up with the definitive list of what was popular.

CASEY KASEM: Three Dog Night – they’re the hottest act on the charts, at the moment.

[“JOY TO THE WORLD”/UP AND UNDER]] They've got the number one song for the third week in a row, Joy to the World.

[THREE DOG NIGHT SINGING “JOY TO THE WORLD”]

[MUSIC UP AND UNDER]

MARK PHILLIPS: The charts helped radio stations compose their playlists and record labels decide which bands deserved expensive promotional campaigns. They factored in to how much musicians got paid and influenced young music fans. In other words, charts were a big deal.

GREG KOT: There was a sense of well, these authority figures are telling me that this music is really good, therefore, I should check it out.

MARK PHILLIPS: Greg Kot is the music critic for The Chicago Tribune and author of the book Ripped: How the Wired Generation Revolutionized Music.

GREG KOT: In fact, what was going on behind the scenes was simply the payola was flowing in for, you know, a certain single and that was the record that was going to get played because the radio station saw that as a revenue stream. I think that genuinely affected chart position.

CHRIS MOLANPHY: It was possible back in the day to really buy yourself if not a number one record certainly a top 10 record.

MARK PHILLIPS: Chris Molanphy is the chart columnist at Idolator.com.

CHRIS MOLANPHY: Up until the 1990s, Billboard would call or fax retailers and radio program directors and ask them, what are your top sellers this week, what are your most played records this week? And, as you can imagine, that system was exceedingly fudgeable.

MARK PHILLIPS: So fudgeable that Billboard finally did something about it. In 1990 they started using the Broadcast Data System, which used computers to count how often songs were actually played on the radio. Yes, it didn't stop payola from outright buying plays, but Chris Molanphy says Billboard went one step further with something called SoundScan.

CHRIS MOLANPHY: This was accurate counting at the retail counter of the sales of records, so basically when you brought a CD or a cassette to the counter and they scanned the bar code, you were, in effect, voting for a hit record at that very moment. It was being counted. This changed everything.

MARK PHILLIPS: Virtually overnight the charts got a whole lot more accurate, and the effects were huge. Chart columnist Chris Molanphy says the music industry responded to the clearer picture of what was popular by promoting not just underappreciated artists, but whole genres.

CHRIS MOLANPHY: The two I would point to most particularly are country and hip-hop. The act that SoundScan arguably made was Garth Brooks.

[MUSIC UP AND UNDER] The very first week SoundScan came online, his then current album, No Fences, shot into the top 10. It’s widely perceived that the advent of truly accurate counting allowed the industry to perceive just how popular he was for the first time and promote him accordingly.

[GARTH BROOKS SINGING/UP AND UNDER] After that moment, Garth Brooks never looked back. He spent the rest of the '90s scoring number one album after number one album, not just on the country charts, but on the major pop album chart. He was the bestselling act of the 1990s, of any genre.

[NWA SINGING/UP AND UNDER] On the hip-hop, side, dozens of rap albums that weren't performing all that well on the charts were suddenly massive top 10 successes after SoundScan. Within a couple of months after SoundScan’s launch, the gangster rap group NWA scored their first number one album. Prior to that, they’d never even made the top 30.

[NWA SINGING, UP AND UNDER] It’s inarguable that SoundScan made it much clearer to the industry that hip-hop was not a fad and that it was worthy of major label promotion.

MARK PHILLIPS: It was a feedback loop. Knowing what was popular helped the industry make it more popular. And so, SoundScan technology was put in more and more record stores. If you buy a record in a store today, there’s a 90 percent chance SoundScan is recording your purchase. But, if you’re a teenager, chances are you don't buy records in stores. Over 50 percent didn't even buy one CD last year. Greg Kot.

GREG KOT: You know, for a generation, probably two generations now, of consumers, buying a piece of recorded music is really kind of foreign to their way of processing [LAUGHS] music, you know, and enjoying it and considering it popular. So it’s much more difficult to pinpoint, here it is, the number one record in the U.S.

MARK PHILLIPS: The main album chart, the Billboard 200, does include data from some digital music stores like iTunes, but Chris Molanphy says it’s still leaving out a lot of young listeners.

CHRIS MOLANPHY: As illegal downloading has taken off, whole chunks of the, shall we call it “underground economy” are not getting reflected on the chart week after week. Ten years ago at this time, the kinds of albums that were topping the chart regularly were Backstreet Boys, Britney Spears. But we've started to see some albums topping the charts recently that are beloved by probably a middle-aged audience. I'm thinking of Johnny Cash, Bob Dylan, who scored his first number one album in over 30 years, with Modern Times, because who are the last people still going to record stores and buying physical albums? People in their 40s, 50s, 60s.

ROB LEVINE: Right okay, the one thing that does skew our measurements is that older people buy more music. They steal less music.

MARK PHILLIPS: Rob Levine is executive editor at Billboard Magazine.

ROB LEVINE: So like, you know, a Bruce Springsteen or a Madonna might over-perform on the album sales chart, relative to some more subjective measure of their popularity. But, as far as, like, you know, who’s stealing what, I mean, of what use is that?

MARK PHILLIPS: Well, maybe if the music industry took into account all the different ways music is consumed today, they could have a SoundScan-like revelation and start promoting the stuff really like. But chart columnist Chris Molanphy says they've already tried.

CHRIS MOLANPHY: Let's look at OK Go.

[OK GO PLAYING/UP AND UNDER] Here’s an act that was succeeding, not necessarily illegally, but not entirely traditionally either.

[OKAY GO MUSIC UP AND UNDER]

MARK PHILLIPS: The band OK Go gained fame on YouTube with a clever music video where they danced across six treadmills. It’s been watched an astounding 48 million times.

CHRIS MOLANPHY: After that viral phenomenon, which wasn't making the industry any money, OK Go’s label put more firepower into the band, promoting them more at radio, sending them on tour, all of the things that a record label has as its disposal to try to make a band bigger.

MARK PHILLIPS: But it didn't really work. OK Go never became a platinum-level band.

[OK GO MUSIC/UP AND UNDER]

ROB LEVINE: This is what I call the “Snakes on a Plane fallacy.” This is really a theory of mine.

MARK PHILLIPS: Billboard’s Rob Levine.

ROB LEVINE: There was a tremendous amount of blog buzz on Snakes on a Plane. A lot of people said, so many bloggers are talking about this, so many fan sites have sprung up about it, I bet that movie is gonna be a big hit. But, it wasn't that big a hit. It did okay. And I think what we learned from that is things that people do as a hobby or for free is generally not a very good guide to what they will buy. If I told you that what I eat at a buffet would be a good guide to what I order at a restaurant, you would say, that’s crazy!

MARK PHILLIPS: But I think the reality for a lot of people, a lot of young people, is that the buffet is always open.

ROB LEVINE: Yeah, but I'm not in the buffet business. Our charts are viewed as a more definitive measure of popularity, for a good reason. What people spend money on is a very good indication of what they value.

ERIC GARLAND: There are a number of different ways to define popularity.

MARK PHILLIPS: Eric Garland is co-founder of the company BigChampagne, which tries to track all the ways music spreads these days.

ERIC GARLAND: And if we're just talking about the breadth of the audience and not the depth of interest, I don't think we're really getting at the value of the music.

MARK PHILLIPS: BigChampagne tracks legal and illegal downloads, streams on MySpace and YouTube, merchandise sold on tours, and so on. Garland says you need all that information to track the fans’ passion.

ERIC GARLAND: One of the things that we've looked at for a number of years is something that we call “songs per fan.” How many songs from this artist is the average fan interested in? You know, an artist like the Dave Matthews Band, if someone is interested in one song, they are likely interested in more than five songs. I chose that example because that’s a very elite club. You know, I would put the Beatles in that company. But let me put the question to you, if you look at the top of the airplay charts, the top of the sales charts, how many songs, on average, do you think people are interested in from those artists? Remember that the number can't fall below one, right? It’s about 1.1.

MARK PHILLIPS: It’s a mathematical way of saying the average artist on the top of the charts is a one-hit wonder. And Garland says this effectively chops off the top of the charts, because one-hit wonders don't make money like they used to. In fact, he says they're so expensive to produce and promote that the real money is with smaller acts with more devoted followings. But how do you measure devotion?

DUNCAN FREEMAN: An artist has to have the toolset to be able to tap into this real-time conversation that’s taking place and engage their fan base.

MARK PHILLIPS: Duncan Freeman is the founder of a website called Band Metrics, which he plans to launch next year. He showed me how it works by plugging in my band’s name.

[MARK’S BAND PLAYING, UP AND UNDER] Yes, I play in a band. In one section, a Google map popped up that showed where we're getting radio plays. Another section located the cities where we're getting the most buzz. It mapped a potential tour route for us. And then, using natural language processing, Freeman hopes to track Facebook, Twitter and other social networking sites so bands can effectively identify their biggest fans, you know, the ones who buy things from them.

DUNCAN FREEMAN: So we look at fans on essentially four levels. We look at the casual listener that may listen to one or two of your songs. Then there’s the fan who listens to your music and they go to a show. The next level up would be the supporter, and these are the folks that are out there talking about your music and who are willing to bring two or three people to see your show when you come to town. And then the highest level, which we call the super-fan, these are your evangelists.

MARK PHILLIPS: The website looks less like a music chart and more like the tools of a Web-savvy political campaign. And maybe that’s what the chart of the future needs to be, a tool for organizing communities. If it works, it would transform and replace the whole idea of charts. Instead of being a list for the record execs of the top-selling artists, it would be a list for the musicians themselves of their most devoted fans. Kind of cool. Only problem, it doesn't make a good radio show.

BRITISH DEEJAY: You’re tuned to Britain’s grooviest radio show, Top of the Pops.

MARK PHILLIPS: For On the Media, I’m Mark Phillips.

BRITISH DEEJAY: Here come those good lads from North London called the Kinks, and it’s called The Strange Effect.

[THE KINKS SINGING “THE STRANGE EFFECT]

[MUSIC, SINGING UP AND UNDER]