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The song of the year so far, Sinead O`Connor`s ”Nothing Compares 2 U,”

broke most of the rules on its way to becoming No. 1 on the Billboard charts. The ballad, written by Prince but transformed by O`Connor, is the centerpiece of her new album, ”I Do Not Want What I Haven`t Got” (Ensign). The album has been No. 1 in America for the last three weeks, and already has sold 2.1 million copies, and her nationwide tour is selling out around the country. (She will headline Saturday at the Chicago Theatre, and there likely will be at least one outdoor date in Chicago during the summer, sources say.) With its intense lyrics and eclectic style (a fusion of rap and Irish traditional music on ”I Am Stretched on Your Grave”; a stark, a cappella rendering of the album`s title track; the searing protest song ”Black Boys on Mopeds”), the album couldn`t be further removed from most popular music of the day: high-tech dance singles from the likes of Paula Abdul, Janet Jackson and Madonna; soul and R & B-inspired pop from Michael Bolton, Bell Biv DeVoe and Lisa Stansfield; rap from M.C. Hammer and Public Enemy; and metal from Heart and Aerosmith.

But the biggest surprise to many in the music industry is the stunning ascent of ”Nothing Compares 2 U,” which has held the No. 1 spot for four straight weeks.

”It breaks the rules for a lot of (radio) formats, but is compelling enough to be played on all of them-which is virtually unprecedented in recent memory,” says Lin Brehmer, music director at Chicago`s WXRT-93.1 FM. ”I wouldn`t call it a once-in-a-year sensation, I think it`s a once-in-several-years sensation. I haven`t seen a song this good appeal to such a broad audience in a long, long time.”

Indeed, the song was picked up on its release not only by XRT, a

”progressive” rock station that normally shuns chart-topping fodder, but by Top 40, adult contemporary and mainstream rock stations all over the country.

”It got an unbelievable reaction everywhere, which was amazing because she had no track record as a singles artist in America,” says Nigel Grainge, the head of London-based Ensign Records, who signed the untested O`Connor in 1985.

O`Connor`s first album, ”The Lion and the Cobra,” released in 1987, sold more than 500,000 copies even though it was played by only 14 commercial rock stations nationwide, according to O`Connor`s New York-based publicist, Elaine Schock. Her star rose because of favorable press reviews and not a little controversy, created by O`Connor`s radical fashion sense and provocative statements about such topics as the IRA and the Irish super band U2.

”I never said I was tough,” O`Connor sings on the new album.

She didn`t need to. Others did it for her.

Even though she was only about 5 feet 2 inches tall and often spoke so softly that she could barely be heard across an empty room, O`Connor exuded aggressiveness by shaving her head, wearing combat boots and singing like she was trying to topple mountains.

With her first album and tour, she reached a young, hip audience with powerful songs of lust and loss such as ”Troy,” ”I Want Your (Hands on Me)” and ”Jackie.”

So it came as quite a jolt when she walked into Grainge`s office a few months ago and presented ”Nothing Compares 2 U” as the first single from her then-unfinished second album.

There was some concern that by covering a Prince song, originally recorded by a Minneapolis band called the Family a few years ago, it would give O`Connor ”a bad case of me-too-ism,” according to a representative for Chrysalis Records, which distributes O`Connor`s records in the U.S.

Furthermore, by recording a ballad, some label people and industry observers warned that she would lose the ”alternative” audience she had built with the first album.

To O`Connor, none of that mattered.

”She said, `I don`t record to sell anything,”` says Schock, one of O`Connor`s closest friends for the last 2 1/2 years. ”She`s had to fight for her music at every turn-the first record was going to sell 25,000 copies, she was told by the record company. Then they said it would be deadly to release a ballad like `Nothing Compares 2 U` as the first single.”

Grainge concurs, but adds, ”There`s not a lot of argument when she wants something. She walks into my office and says, `I want this to be the single and I want it out by Jan. 8,` and that`s it. It`s very much her own ballgame. We`re long past the stage where anyone can tell her how to run her career.”

What convinced even the doubters that the song would click was its video, which O`Connor made in collaboration with director John Maybury.

Stunning in its simplicity, the video proves without a doubt that O`Connor has made Prince`s song her own, a tour de force of nuanced singing, passionate lyricism and finally, naked emotion.

The camera`s eye frames O`Connor`s face, and her deep blue eyes in turn never let it-or the viewer-go. For five minutes, one is in complete thrall of that gaze, that voice, as it swings from biting anger on one line-”I could put my arms around every boy I see”-to whispered regret on the next-”But they`d only remind me of you.”

When tears well in her eyes during the final verse, it`s impossible not to be moved.

”It wasn`t an act,” Schock says. ”They shot several takes of the video, but only on the first one did she totally lose herself in the song.”

The video, which actually preceded the release of the single, was convincing proof of the song`s power. The public did the rest.

”We didn`t make it happen, it rocketed on its own,” says Cindy Redmond of Chrysalis Records. ”No one knew this was coming, and we spent the first few weeks of its release catching up (with product orders).”

The album`s nine other tracks, rich in personal detail and characterized by subdued, spare arrangements, live up to the single`s promise of emotional directness. Written largely in November and December last year, ”I Do Not Want What I Haven`t Got” is a chronicle of O`Connor`s rollercoaster life since the last album: her emergence as a pop star and the misconceptions that entailed; the birth of her son, Jake, in July, 1987; her separation from and later marriage to the boy`s father, drummer John Reynolds, in February, 1989; and the contentment she`s found as a mother and self-described ”housewife”

in London since then.

O`Connor`s desire to be herself is nothing new, though the public has often misinterpreted her words and actions. When she shaved her head, she was surprised that it was perceived as some sort of statement on feminity.

When she ”shot off her mouth” about the IRA (saying she supported it)

and U2 (belittling the band`s self-righteousness) she was taken aback that anyone would even care, much less turn her words into a headline.

”She`s learned that she`s in the public eye and that everything she says is going to be written down,” says Schock, so O`Connor now routinely refuses interviews. ”She realizes that not doing press or hyping the record represents a sacrifice, but other things are more important . . .”

But a little success has been known to go a long way in rearranging a performer`s priorities. At 23, can O`Connor handle the hype?

Grainge, who watched as O`Connor literally grew up in the Ensign offices by answering phones, making tea and telling Irish fairy tales to his children, doubts it.

”The last thing she wants to be is a rock star,” he says. ”If anything, this will only make her more wary. God knows when we`ll get another album.”