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Is Radiohead's "In Rainbows" a flop or a blockbuster?

Politically-fueled Indie/Alternative Rock band Radiohead stood up to DRM and record label's campaign of terror against music listeners when they offered listeners the ability to name their own price and receive their new album via an Internet download.

The band broke headlines in early October when it announced that fans can get the new album two ways.  First, they can go online and download it at whatever price they want -- from free to 99.99 GBP.  Downloads began October 10th.  Serious fans could also elect to purchase a box set, with a CD version of the album, vinyl copies, art books and bonus tracks for a mere $81.75 USD.  These box sets will ship on December 3rd.

So nearly a month later the record industry, tech-observers, politicians and music lovers are scratching their heads collectively and trying to figure out whether Radiohead's album was a success or a failure.  The basic problem is that the band itself hasn't released any information on sales figures yet, so it is hard to tell what is real and what isn't since all sales are done exclusively by the band's website.

In the U.S. and the U.K., a 12 percent royalty to the CD artist about the best an artist can expect, and typically the artist is hit with many additional fees of various sorts by the label.  This means that on the average CD, which costs around $12 to $14 USD at major retailers, the band will make around $1.00-$1.50 USD.  On the other hand, little bands find it hard to "make it big" without a label, as labels are willing to front bands large amounts of recoupable expenses if they think the band has significant ability to make it big. 

A very good read on this topic, is "The Problem With Music" by Steve Albini, independent and corporate rock producer, who is most famous for producing Nirvana's "In Utero".   The article, which can be found here, reveals that on a typical "hit" rock CD, the label might make around $710,000 USD, while a member of the four-member band would only make about $4,000 USD in net income.  Of course, some artists obviously wildly surpass these figures, but these are typical numbers given by someone very entrenched in the music industry.

To top it off, record companies have adopted draconian tactics in using upstream takedowns on torrent sites, spies and massive lawsuits against individuals and groups which share music.  Several bands, including Nine Inch Nails, headed by Trent Reznor, and Radiohead have thrown in the towel and said the record labels have simply gone too far and are no longer necessary.

The real quandary is, as idealistic as these statements sound; do they make economic sense for the artist?  This has left many holding their breath, waiting to see what happens.

Well, the first news has been from internet research firm comScore.  comScore reported that only about 38 percent of people downloading the album paid for it.  Among paying fans, Americans on average paid the highest amount, at $8.05 USD per download.  Fans from other countries average $6.00 USD and 17 percent of paying foreign fans paid only a penny to $4.00 USD.  Finally, comScore found that on average (including non-payers) the album sold for $2.26 USD.  A source close to the band was referenced in a Wall Street Journal article as saying that 1.2 million copies of the album were downloaded on the first day of release.

If accurate, it would mean that Radiohead made nearly $2.7 million USD before expenses, during its first day of sales, an incredible figure.

Some observers were pessimistic about these results though and state that the band could have done much better with a traditional business model. Average profits of $2.26 USD, they say, is nothing to cheer about.

Radiohead released a statement countering these comments and also disputing comScore's figures.  Radiohead said:

"In response to purely speculative figures announced in the press regarding the number of downloads and the price paid for the album, the group's representatives would like to remind people that, as the album could only be downloaded from the band's website, it is impossible for outside organizations to have accurate figures on sales."

This is true --  comScore did not get information directly from Radiohead's site; rather it used voluntarily installed information gathering software that allowed music listeners who bought the album to respond about how much they paid.  While comScore has a solid user base over 2 million voluntary users, many feel that certain kinds of internet users may be drawn to comScore, skewing demographics. 

So if comScore is wrong, did "In Rainbows" fall below its estimates or did it beat them?  Some see Radiohead coming out to deny the statements as an indication that "In Rainbows" exceeded the estimates.  It’s all speculation until the real data comes out from Radiohead.

However, despite the uncertainty, many music figures are already weighing in on the band's success or lack thereof.   Nine Inch Nails' Trent Reznor congratulated Radiohead for bravely fighting the system, but he feels their business strategy was flawed. 

Reznor is following a different business strategy on his release of Saul William's album, "The Inevitable Rise and Liberation of NiggyTardust."  He is offering fans only two options:  either download the album for free or buy it for $5 USD.  Furthermore, all options are not created equal; the $5 USD version will be in 320 kbps MP3 or FLAC lossless audio tracks, while the freeloaders will only get lowly 192 kbps MP3.  Reznor hopes that the improved track quality will lure many audiophiles to pony up five dollars for the paid option.

Ultimately the success or failure of this movement rests largely on two factors -- how well optimal distribution mechanics can be developed and, most importantly, on the average music listener's attitude and level of altruism.  Obviously, acts such as Radiohead and Nine Inch Nails are unlikely to totally flop in their efforts, due to a large, loyal fan base.  Whether their efforts will lead to surprising success and catch on with smaller acts nationwide, though, relies heavily on these factors.

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Reznor getting it right
By FITCamaro on 11/12/2007 10:20:00 AM , Rating: 5
I definitely think Reznor's idea is better. If you want to download it to try before you buy, then you download the free, crappier version. Then if you like it and want to pay, you pay $5.00 and get much better quality tracks. And $5.00 to me is a perfectly acceptable amount of money to pay for an album you've already gotten to listen to.

RE: Reznor getting it right
By Samus on 11/12/2007 10:28:05 AM , Rating: 2
Considering how hard Trest was getting raped on fees HE was paying for to get special packaging for 'With Teeth' I'd be hard pressed to hear anything in favor of record labels from him. He's experienced 'draconian' first-hand.

RE: Reznor getting it right
By 16nm on 11/12/2007 11:21:27 AM , Rating: 3
Trest was getting raped on fees ... I'd be hard pressed to hear anything in favor of record labels from him.

Absolutely. From the article:
on a typical "hit" rock CD, the label might make around $710,000 USD, while a member of the four-member band would only make about $4,000 USD in net income.

$4,000 of $710,000! That is only one half of one percent! It's no wonder so much of today's music sucks so badly. No talented musician in their right mind would ever persue a career in music with income like that. How many hours does it take to produce an album? I would like to know how much their time is worth.

RE: Reznor getting it right
By BladeVenom on 11/12/2007 12:07:12 PM , Rating: 2
Most of them do it because it's what they love. Most bands can't live off of record sales that's why they go on tour, play at clubs, teach music lessons, or have a part time job.

RE: Reznor getting it right
By Oregonian2 on 11/12/2007 2:24:11 PM , Rating: 2
Yeah, I read a book about the music business, written by an insider (might have been the same person, I don't know). It's definitely very hard for the band to make anything even if the record company has large revenue totals. Only band-person who'd get anything would be the writer of the music (if they didn't write any, then they get pretty much nil after all the fees are deducted). Once a band/entity becomes famous and has met previous obligations, they can then negotiate a better deal. That of course makes one-album (or even three) wonders 100% out of luck.

As to Radiohead, having heard the first 30 seconds of some of their work on one of the websites with previews, I'd say that if they get anything at all, they're doing good. :-)

RE: Reznor getting it right
By RubberJohnny on 11/13/07, Rating: 0
RE: Reznor getting it right
By Oregonian2 on 11/13/2007 3:38:38 PM , Rating: 2
So you read the whole book and never took in enough of the details to recognise/remember the author? way to skim read!

Sorry, I read it a few years ago, and perhaps unlike you, I read more than one book a year, so I just don't remember the authors's name. I've read thousands of books over the years and I probably only recall the author's name on a minority of them. Their name is usually only on the cover and I'm usually reading the innards, so I don't see it very many times to make an imprint unless I like the author enough to want to read another one (like Evanovich for instance, read hers like popcorn).

I can understand that radiohead's music might not be everyone's cup of tea but if this is the way you decide what constitues good/bad music you need your head read by someone with better comprehension skills than your own.

Yeah, I'm a radical outsider. I judge whether music is good or bad by listening to it. Just call me unconventional. Oh yeah, and I'll speak my opinions too. That we seem to have in common.

RE: Reznor getting it right
By RubberJohnny on 11/13/2007 8:59:31 PM , Rating: 2
Yeah, I'm a radical outsider. I judge whether music is good or bad by listening to it. Just call me unconventional...

But 30 seconds of it? Then you dismiss it as crap? Maybe Eminem is more your style where he's thrown 20 catchy "hooks" at you in that first 30 seconds? Here's a hot tip for you, the best music is not always the most accessible! Some artists material take 3-4 listens before they "grow" on you enough to make you want to purchase the album, most of the time these end up being the albums with the most longevity.

Alot of radiohead songs go for around 4 mins and don't follow a simple chorus/verse structure. The end portion of the song can be completely different to the start. Since the album is essentially free why didn't you download the whole thing and give it a decent go? Then i might respect your judgement a little more.

Can you tell i'm a radiohead fan? Then again i'll listen to pretty much anything...

RE: Reznor getting it right
By Oregonian2 on 11/14/2007 3:34:11 PM , Rating: 2
But 30 seconds of it? Then you dismiss it as crap?

That's what I have available, and it's those site's intention that I see how good or bad it is using that clip. That's the limit on many sites I've run into over the years. If it can't "hook" me in the first thirty seconds (much like if the first fifty pages of a book can't get my interest up) my opinion is likely to be negative. May just mean that it's not terribly commercial in nature (where an upfront hook would be of great benefit). Being non-commercial would sufficiently back up my original comment that I'd be surprised that they'd sell much without a lot of record company support (at least for their initial work before working up a fan base). Although my huge CD collection may not seem to back me up on this point, I don't try to buy any/all CDs in order to listen to the whole pieces multiple times in order to prove to myself they are indeed crap. I've a few that I think that way about now, but didn't have that expectation when I bought them.

RE: Reznor getting it right
By Vanilla Thunder on 11/12/2007 10:29:39 AM , Rating: 3
I agree. I would gladly pay $5 for the 320 kbps MP3 or FLAC lossless audio tracks from any band that I'm a fan of. I think this system works, but not every band could simply "give" the music away. Smaller bands would have to set a minimum price point to make this a successful business model. I hope it happens.

RE: Reznor getting it right
By splint on 11/12/2007 12:09:27 PM , Rating: 2
Actually, Radiohead’s model is a more profitable one. Basing a price on what people are willing to pay more accurately fills the area under the demand curve. This is the same model that airlines use to sell tickets. You don’t know what the guy next to you paid and the airlines intend to keep it that way in order to maximize profits. (Although in that model the seats are a finite resource.)

Radiohead’s big flaw was pointed out in another forum – you can’t try-before-you-buy. You decide to pay or not and then they sent you a link to the album. They ensure one download per user because you cannot redownload using the same email address. This way, if you go back and pay with a different email address their statistics get screwed up. (Maybe they can filter by IP…)

RE: Reznor getting it right
By Ringold on 11/12/2007 1:36:06 PM , Rating: 2
Basing a price on what people are willing to pay more accurately fills the area under the demand curve.

Lol*, firms do that by offering what they think is your maximum willingness to pay, not saying "Please pay your maximum, but here is the option to pay nothing instead!". When faced with that option, and this should be obvious, the overwhelming economic incentive is to free ride. Public goods face the same problem; we'll all watch PBS, but who donates?

It ends up being an act of charity. How much you pay for something you can as easily get for free depends on how good you want to feel about yourself or what impact you suspect paying up may have on your social status by admitting to having either paid up or paid nothing.

* My first time starting a DT sentence/post with Lol. May it be the last. But I was lol'ing..

RE: Reznor getting it right
By AmbroseAthan on 11/12/2007 10:35:00 AM , Rating: 2
I might not even offer the free version for download. Just let people stream the entire album using something silimiar to PureVolume (or any of the players to let them do this), to listen to it at 128Kbps. Then, let people buy it $5.00 for the high quality album.

I don't see much of a problem paying for albums if the whole album is good, or it just has a good price/volume ratio. I think the $5-10 mark is the prime area for an album depending on how many quality tracks (or extras) are on it.

I tend to buy everything I listen to (not used p2p in the last few years), and I recently bought Flyleaf's "Flyleaf" album off iTunes for the $9.99. Is it a perfect album?, no. But it came with the original 11 songs, 5 more redone acoustically, and 6 or 7 of the music videos. All-in-all, $9.99 seemed like a great deal to me, IMO, for the album.

RE: Reznor getting it right
By maverick85wd on 11/12/2007 10:51:28 AM , Rating: 3
download the free, crappier version.

I'm not sure I'd call 192kbps crappy, tho it's definitely not as good as 320 or FLAC.

I would probably offer the free album as 128kbps just to sample and then offer the better version as $2-however they want to give you as Radiohead did. If a person is willing to give you more than $5 because they feel it's worth it, why wouldn't you give them that option? I gave Radiohead $6 because, even though I'm not a particularly huge fan, their album was worth $6 to me... and I was supporting their cause. At least in this way I bought it from them, I would have never bothered if it was a regularly-priced $10-14 CD

RE: Reznor getting it right
By Lonyo on 11/12/2007 10:57:41 AM , Rating: 2
It's similar to what Nettwerk (Canadian record label) have for some of their srtists.
You pay some money for 256kbps or so mp3's, or you pay a bit more (like $1 or $2) for flac of the same music.
Quite nice to have the options, and both mp3 and flac are priced reasonable, and DRM free :)

RE: Reznor getting it right
By Moishe on 11/12/2007 11:05:30 AM , Rating: 2
I think Reznor's idea was good, but I think he gave away too much. I think fairness is as simple as allowing people the option to try before you buy. You can easily hear a 128 or even a 64kbps mp3 well enough to "try" but it's low enough that most people will want better quality.

I think people should pay for things, but that the payment should be reasonable. Free low quality mp3s, $5 for 256kbps files, $10 for lossless seems very fair to me. That way you can buy what you want/need. $10 is not too much for a decent album.

RE: Reznor getting it right
By Drexial on 11/12/2007 11:26:27 AM , Rating: 2
i think $5 is a perfect price for a product with no physical packaging. Free for 128,$5 for lossless Digital, $10 for CDs with a decent standard of artistic quality in the packaging. this is what i feel like would be the best set up for album releases. Vinyl would probably fall into the $15 range as i feel its a bit harder medium and its also completely lossless.

RE: Reznor getting it right
By joemoedee on 11/12/2007 11:40:37 AM , Rating: 2
Personally, if I was an artist, I wouldn't offer it for free.

I have some older mp3s in 128kbps, and whereas you can tell a difference, its not a giant difference to most people's ears. You also have to figure the majority of people listening to mp3s are doing so on a portable media player with the crappy ear buds that came with it, so that makes the difference even less noticeable. Also, figure in the general public doesn't even know what a kbps is, FLAC, or AAC or any of the technical terms. They have an ipod and they want to listen to their itune! ;p

I'd at least charge $1.99 or $2.99 for the full album at 128 kbps. It's inexpensive enough that people wouldn't balk at paying it, but also could mean some decent income to the artist. Offer lossless and CD at more money, and you're covering all bases without spiting your (as the artist) own income.

RE: Reznor getting it right
By Darkskypoet on 11/12/2007 1:30:03 PM , Rating: 4
The problem is that ther is a massive difference in effort when you go from $0 to $0.01. No don't get me wrong, its not hugely difficult, but all of a sudden you require a method of payment, forms to fill out, etc. There is a marked difference between free and any cost. Not that I am saying x isn't worth it, just pointing it out. There are many that would, but don't have / want to use a CC for it, also even with other payment options, there is still those who prefer to limit the exposure of their information on the web. Regardless of magnitude of effect which is hard to get a solid answer about, there will be an effect and insisting on payment would be a symbolic selling out / nod to the man. (banks, business, etc.)

Free at whatever quality ensures those who just want to listen and take do so. Those who want to buy period will more then likely pay $5. I agree that people should be allowed to pay more then $5 as many would, however to ensure wide spread proliferation, and ability to chart dissemination success more accurately, free is the best price floor.

Also, the Radio Head endeavor allowed for near perfect price discrimination, which any company would love to have. The ability to charge what one is willing to pay has long been sought by many including airline companies (as was mentioned).

All in all, one must remember that much of what the record labels do for artists is allow them access to markets / ad space / shelf space that they control. The eventual downfall of large 'imperialistic' sorts of record companies would mean the freeing of shelf space, radio station time, etc. The force from the record companies to promote certain albums, etc. would slowly go away, leaving us and those "virtual / brick record store owners" to discover and push bands with authentic talent and sound, rather then the next great sony/bmg/universal commercial moneymaking scheme.

By controlling the means of distribution, the record companies are able to 'give' this to new and upcoming acts. removing that control is a side effect of their shrinking revenues. I hate to utilize a buzz word here, but the removal of the record companies as the powerful forces they are would give us a much more organic music scene. Perhaps a much less commercialized one as well.

(artists now have the required triumverate: distribution method, production method, and advertising method, to allow for them to succeed. What needs to be brought down are the road blocks to the last piece of the puzzle, an open market)

RE: Reznor getting it right
By Polynikes on 11/12/2007 12:32:56 PM , Rating: 2
For $10, I'd rather have a CD or record in-hand which I can rip my own high-quality digital tracks from.

RE: Reznor getting it right
By fleshconsumed on 11/12/2007 11:55:51 AM , Rating: 2
$5 is an excellent price for a lossless version. Finally a good alternative to traditional distribution methods such as buying CDs or using iTunes. CD's are still expensive unless you buy them on sale or on the release day, iTunes is cheaper, but at $10 an album it costs nearly as much as real CD while missing fancy case/artwork and being lossy. $5 is a real step to bringing what consumers want: now they have a choice at buying real CD and get everything, or forfeit case/artwork but still get lossless version at a significantly discounted (unlike at iTunes) price.

This will set a precedent for arguments in the future
By Staples on 11/12/2007 10:23:47 AM , Rating: 2
I have always argued that the vast majority of people who complain about DRM are just making excuses to justify their piracy. I mean, how many of these guys buy the CDs? 5%? People have always told me that I have no proof but finally a trial has actually occured. I know there will be ones who respond with all types of arguments in their favor (the typical I want music for free crowd) who will say things like 90% of the people who downloaded the album would not have bought it anyways. 90%? I don't think so. At the root of it all, most people have a sense of entitlement but they will never admit it. Argue other factors like DRM which was never really the problem. The fact that music cost money is the problem for most people. I am still the only one I know who buys music (let alone all of it) off iTunes.

By Brainonska511 on 11/12/2007 10:37:12 AM , Rating: 3
That's BS.

People complain about DRM because they don't want to be treated like a criminal for purchasing a product.

Music cost is a problem - the price of CDs in comparison with other forms of entertainment results in people spending less money on music and more of their "entertainment dollars" on other, more valuable [to those people] things which then results in record companies screaming bloody murder since their profit margins are taking a hit from their entrenched attitudes and business models.

And for the record - I do buy CDs when I can, provided they are really good and aren't loaded with DRM that treats me like a criminal for paying for a product.

RE: This will set a precedent for arguments in the future
By MPE on 11/12/2007 10:59:08 AM , Rating: 2
Cost of music????

A CD is less than $20. That is 1/3 the cost of a new game. And it has a longer shelf life. You can easily share with others WITH NO LIMIT - unlike GAMES. I don't see pitch forks at the game of the video game industry.

And a music CD works out of the gate - unlike many games.

How about movies? HAlf the cost of CD but it is just for one time preview. DVD Movies? Compressed and with built in copyright protection.

So what 'entertainment dollars' are you reffering to?

Please, the cost of music argument NEVER held water. And Radiohead's example just proved it. Even for a merely 1 dollar a lot of people refused to pay for it.

I hate DRM as much as the next geek, but don't be a liar. We all know a lot of people casually downloading illegal music is more about apathy about the law and a sense of entitlement. Saying it is about cost or trying to stop the big bad record labels is pure dog crap.

No one above 14 is that naive.

By Drexial on 11/12/2007 11:35:58 AM , Rating: 2
nobody said the cost of other entertainments was fair. But to be honest, a big time movie usually has a production budget of over $50-100 million far less than the cost of the production of an album. Game development also requires several times the man power that an album release does. Programmers, Testers, Texture designers, Animators, so you can see where costs build up.

so to say an album is worth that ratio when you consider its 4 people playing instruments one producer and a guy on a sound board. the number of people and costs involved isn't nearly as high as other forms of entertainment. but the cost of the CD isn't so much unfair cause how much we pay. but the low percentage of that that the artist that is actually responsible for the CD actually gets.

By MPE on 11/12/2007 12:11:45 PM , Rating: 2
You have changed the discussion.

No matter what the cost of the production is - what does that have to do what YOU want to pay for something?

A movie might cost 200 million to produce but it does not mean it is worthy of a $10 ticket. Same for CDs. NEvertheless, the worth has no justification if one can download it for free. In fact, the point it has no worth to individual yet they download it only underlines the entitlement and apathy argument. If it is not worth anything why the download it for free?

Second, the whole what the artist get is another BS argument (sorry for being blunt). This WAS NEVER an issue with the so called p2p shares. Radiohead is not the first artist to offer their music with little or no involvement from the slimey record labels. Yet, the results are the same - many music downloaders dont care either by not supporting it (when a lot of indie labels still get very little support) or download it for free.

And that argument is contradictory. If you care about how LITTLE the musicians get, why would you DENY them the small amount they get by downloading for it free? You made little become nothing. In fact not only that, since your refusal to buy the CD and pay for the download, the label now thinks the artist are failures - or not as profitable. Thus you have directly reduced their chances to be signed to a bigger contract.

So explain to me again why people saying CD is too expensive and not paying for it and downloading the music for free is helping the artist????

By fleshconsumed on 11/12/2007 12:04:08 PM , Rating: 3
Even for a merely 1 dollar a lot of people refused to pay for it.

Really? I guess $2.7 million estimated sales in the first day were paid in imaginary currency?

The rest of your comments are equally pathetic.

RE: This will set a precedent for arguments in the future
By MPE on 11/12/2007 12:18:32 PM , Rating: 2
Uhm yeah you must have ignore the rest of the article where they state a large portion did not pay for it. Even with the average paying customer in the US spent $8, the ENTIRE average was $2. Even if you go conservative on the estimate, I doubt Radiohead can state statistics that would counter the idea that a lot of people we want to admit, downloaded the album for free. Not $2, not $1 and not even a $.01 - but for free.

Your argument is myopic and selective.

And regarding the 'equally pathetic' sorry about that. I did not notice yours was equally powerful. Oh wait... you dont have one except quoting one specific statistic.

By Veraiste on 11/12/2007 12:47:07 PM , Rating: 2
Well, considering most people get it for free as it is (p2p), and that a $2 average is more than an artist normally gets per cd, isn't this good for them? Sure, some people didn't pay, maybe lots, but a better statistic would be how many paid that wouldn't have normally.

By fleshconsumed on 11/12/2007 1:07:58 PM , Rating: 3
Uhm yeah you must have ignore the rest of the article where they state a large portion did not pay for it.

You miss the point. Who cares how many people chose not to pay for the album? As long as their bottom line is better than dealing with labels it is a success. And so far, by all indications it does appear to be a success.

RE: This will set a precedent for arguments in the future
By MPE on 11/12/2007 1:26:51 PM , Rating: 2
I was talking about the part about 'BEFORE expenses'.

Until Radiohead actually opens the book, how great or a bomb it is would be hard to judge. But the amount of people getting it free... that is a whole different story.

And second, how much they earn does not justify anyone downloading it for free. So instead of the labels ripping them off, the general public should? Wow, people do care about musicians.

By fleshconsumed on 11/12/2007 2:05:09 PM , Rating: 2
Until Radiohead actually opens the book, how great or a bomb it is would be hard to judge.

Agree, it is still uncertain, but from what I've read it is a success. At the very least they won't go starving for another couple of years before they release next album.

And second, how much they earn does not justify anyone downloading it for free. So instead of the labels ripping them off, the general public should? Wow, people do care about musicians.

And who appointed you to protect their interests? The fact is you don't get a say in how Radiohead chooses to distribute their albums, if they want to let people have a choice to pay whatever they want, including nothing, let them. It's their band, it's their music, they don't need you defending them. That's why I said bottom line is all that matters. If I were radiohead, as long as the new method of distribution got me more than what I would have gotten by making contract with labels, I couldn't care less about how much general public is ripping me. And I suspect that is what Radiohead is thinking. Face it, piracy is part of life, no matter how much labels try to control it, they never will short of implanting chips in our brains. So why not capitalize on people's hatred for RIAA instead? That is what Radiohead is doing, and like I said, it appears it is working for them. Sure, most of the people are downloading their album for free, but their bottom line appears to be better than dealing with labels, and that's the only thing that matters. Radiohead managed to maximize their profits without alienating old fans, they also managed to get free publicity and get new people to try their music for free. It's a win-win situation for them, they are making good money, possible more than ever and who cares that people are downloading their album for free?

By FastLaneTX on 11/12/2007 4:17:30 PM , Rating: 1
Sure, lots of people downloaded it for free. I wonder how many would have gone back and paid after sampling it, which their site wouldn't allow? How many would never have bought the album if they'd heard the tracks before they had to decide what to pay? There's a reason stores these days have "listening stations" -- so you can decide whether an album is worth the money before you have to shell out your money.

I think Radiohead's music sucks (just a matter of personal taste), so I didn't bother downloading the album in question. There's lots of other bands I'd happily give money to even if their music was available for free. If Radiohead managed to pull in millions of dollars in a single day just by letting people name their price, how is that worse than going on a grueling tour for several months to make a tenth as much?

I think Reznor's got the right idea: let people sample the music for free and then decide if they feel like paying for the high-quality version. If they don't like the music enough to pay, what's the harm in letting them have the low-quality version (which they wouldn't have paid for anyways) for free. Best case, their friends hear the free version and decide to pay themselves, so the band actually makes money on the "free" downloads.

Also, the point about how much bands get can't be overemphasized. Even if their revenue is something like $2 per download, that's a shitload more than any label would give them even when customers are paying $10-15 per CD.

By Keeir on 11/12/2007 1:42:36 PM , Rating: 2
Cost of music????

I think you are missing his point

Back when I was buying CDs (a few years ago), CDs were typically priced 15-20 dollars and contained about 45 minutes of music. Its true, you can listen to music many many times, but the "new" experience is only 45 minutes long and only involves 1 out of 5 senses.

Movie entertainment on the other hand is typically around 120 minutes long and involves 2 out of 5 senses.

Books/Comics/Etc involve 2 senses. Typically entertainment times in the 4-6 hour range.

Video Games involve 2 senses, and are interactive. They can last anywhere from 10 hours to 60+ hours to even more for good multiple player titles.

ALL of these things can be shared (although Video Games typically only like 1 online user at a time). Is it any wonder that so many people are turning they're backs on music to consume other entertainment?

Please, the cost of music argument NEVER held water. And Radiohead's example just proved it. Even for a merely 1 dollar a lot of people refused to pay for it.

Ummmm... no. Radiohead's example is pretty much the other way... somebody offered people FREE music and a significant number choose to pay for it. Its actually pretty remarkable.

By MPE on 11/12/2007 1:59:29 PM , Rating: 2

SO each medium has its limitation. Your argument is incomplete.

What does it matter what senses it stimulates. We are talking about VALUE. One that is variable depending on the individual. The point is, no matter the value, even if it is nothing, one does not have the inherent right to receive it free from its creators and owners. Period.

It is a basic concept of human existence. Even if I think your life has no value, I have no right to take. Even if I think people's intelligence is is subpar, I have no right to remove their right to vote. Even if I think music sux from Britney Spears, I have no right to take co ownership by downloading it for free and sharing it at as my own.

[quote] somebody offered people FREE music and a significant number choose to pay for it.[/quote]

Again you twist the fact. They did not made it free. They made payment voluntary. That is like saying freeware is free.

And you looked at the glass half full. You fail to confirm the amount of people who freely downloaded it, and likely distributed it.

Yes, Radiohead music can be downloaded it for free. But the point was, even given with choice to download it at any affordable price (even a penny remember)- many people did not. So the argument that people downloading music for free is because of price is BS.

By Brainonska511 on 11/12/2007 9:57:48 PM , Rating: 2
Obviously, you just don't get it.

Sure, a $10-$15 CD costs less than a game, but the game has a higher perceived value to the consumer. If a consumer budgets $50/month for entertainment purposes, then they might buy the game just because of that instead of 4 or 5 CDs.

As for whether it works out of the gate, that has nothing to do with the cost argument I put forth. Heck, you want to argue about things working, look at those lovely DRM wrapped CDs that don't work out of the gate....

Now onto Radiohead - they haven't released any information as to how much they made and what people paid on average. The opt-in system that the market researcher is using is a flawed methodology. Now, even if the market research company was correct, Radiohead received a lot of attention for this from many people who never would listen to their music - how many of those people downloaded the album just to see if they would like it? How many tossed only one or two dollars their way just because they believe in the idea but don't actually care for their music?

I don't see how I'm a liar by hating DRM or anything I said. You might want to try a dictionary or thesaurus to find words that would fit what you want to really say. As for apathy and sense of entitlement, get a clue. There are many reasons to download music - between hearing new things (that you wouldn't hear anywhere else), trying before buying, etc...

By Moishe on 11/12/2007 11:13:10 AM , Rating: 2
I buy CDs.

I think DRM sucks because it hurts the consumer and does not stem the tide of piracy. I don't mind if they protect their investment. I actually think that they SHOULD have some protection... however that protection should never come at a cost for the consumers who are legally buying their product. That's just biting the hand that feeds you.

I don't think anyone can blame consumers for bailing out on the music industry. The music industry has made the choices and alienated a lot of consumers. That's purely on their side. They made their bed and they should sleep in it.

Piracy is not right, but the music industry has practiced their own form of piracy against the consumer for years and the consumer seems to have finally wised up and is rejecting the old school notion that rape by the RIAA is fun. Basically it's the free market deciding that DRM is costly, it's harmful, and it's a hassle.

By fic2 on 11/12/2007 12:01:00 PM , Rating: 2
Let's see
Option 1: I can buy a CD that probably has DRM that won't let me play it from my PC, or worse, installs a rootkit on my PC.
Option 2: I can download the album DRM free and be able to listen to it anywhere I want. Bonus because I didn't pay for the DRM.

I have chosen option 3: Don't buy CDs or download music.

I probably would have paid Radiohead for the download if I had even bothered to download it. I like some of their older stuff.

I like Trent's model although I agree with several people here that he is offering the free version at too high of a rate.

I have a really good friend that is in a band. They have been together 9 months. They sell their CDs at their shows for $5 and have sold up to 200 CDs at a couple of shows. Seems like they make more from their CD sells than some "big time" musicians.

By fleshconsumed on 11/12/2007 12:16:25 PM , Rating: 2
DRM which was never really the problem

DRM is never a problem? Spare the fairy tales. I bought Terminator 2 High Definition DVD a year or so ago. On the second disc it had 1080p encoded version of the movie that you could watch. The catch was that you had to either use proprietary (and crappy one at that) player, or jump through a bunch of hoops just to watch it. Since I didn't want another piece of poorly coded software screwing up my system I opted for the second option. In order to do that I had to use WMP (not the finest software to say the least, although better than proprietary player I mentioned earlier), I had to manually download license from the internet, then navigate to some obscure folder on DVD and drag and drop a file into WMP. Not the most intuitive method and I would have never been able to do it without help from google. Now the best thing is that one, the license is only valid for US, nobody in the rest of the world can watch the movie (unless they use US proxy to obtain license), the license is only valid for 5 days, so if I wanted to watch it a week after, I would have to repeat entire process again, and lastly, my viewing of the movie depends on the availability of the servers, should they experience technical difficulties, or say go down forever I will never be able to watch the movie again. How's that not a frigging problem? Take your trolling somewhere else.

Oh noes
By Griswold on 11/12/2007 10:36:23 AM , Rating: 2
comScore is perhaps less useless and non-representative than other marketing researchers and dataminers such as Alexa for web-traffic research, but its still nothing I would bet my money on.

How about we wait for the real figures instead of giving these free riders so much attention?

RE: Oh noes
By TomZ on 11/12/2007 10:59:45 AM , Rating: 2
Radiohead has stated they do not intend to release sales figures, so relying on the estimates from marketing research companies is going to be the best data available, unless Radiohead changes their minds.

RE: Oh noes
By ksherman on 11/12/2007 11:13:12 AM , Rating: 2
But then who said that even Radiohead's numbers are going to be real? They need to "win" in this venture, otherwise it was all a waste. If they "win" then other bands will jump on their bandwagon and hopefully start to stick it to the Industry owners...

Looks fine to me
By Parhel on 11/12/2007 11:06:00 AM , Rating: 2
I guess I don't understand. If the estimates are correct, they made $2.26 per album sold. Through the traditional channels they would have made at most $1.50 per album according to the article. That means they made 50% more than they would have if they employed a record label, right?

On the other hand, I don't think this method of selling music would work in the long term. Eventually, the people who paid just to make a statement wouldn't be interested anymore, and the rest would likely pay nothing.

RE: Looks fine to me
By Oregonian2 on 11/12/2007 2:29:10 PM , Rating: 2
No, it'd be a LOT more than via a label. That percentage via labels was prior to fees which will take away nearly all of that percentage. Their net would be very very low (according to a book I read written by an insider).

On the other hand, if a label was able to get anyone to actually buy their music, then that may have been near miracle-work and worth every penny. But then that's only my musical evaluation... :-)

Cost of CDs not a big issue with me
By HeavyB on 11/12/2007 11:19:43 AM , Rating: 2
Being a relative old fart here, I'm not of the Napster generation that thinks music is free. I have no problem paying $10-15 for a quality album. I just don't like how the artist typically gets raped by the recording industry. I like this type of model as long as the lossless files are available. Again, being an old fart I have more $$ tied up in my home stereo system than many ATers do in their car and I don't want to have to listen to compressed recordings on my hi-fi.

By Oregonian2 on 11/12/2007 2:51:02 PM , Rating: 2
Boy,.... "hi-fi". That's what it said on records (big black plastic ones) that had that new fangled feature: "stereo". Wow. Nostalgia.... :-)

P.S.- I've still my old American made AR-9's (the original one, not the smaller-woofer cheaper Chinese made product using the same name more relatively recently). And they still work, although I haven't tried taking down the entire neighborhood with it's bass output lately. Haven't done that in a long while. :-)

P.P.S. - Look like these, but mine look "mint":

P.P.P.S. - Having started with the first CD player that came out (Sony CDP-101, which I still have in the garage) I've a LOT of CD's collected over the years, and the first ones out were especially *SPENDY*. Bought CD's at the the high-end store that sold the CD Players and would check with them from time to time just to see if *any* new CD were released. :-) I don't dare estimate how much I've paid buying CDs (and still counting...), it'd be frightening.

I don't get it
By ancient46 on 11/13/2007 1:51:09 AM , Rating: 3
How can "Observers" feel that they could have done better with a traditional business model? If the "Hit Album" figures are correct and the band nets $16,000 typically for their work, it seems to me that they have already made more than they possibly could with the RIAA. If they make more a penny a download after expenses they already netted more on the first day than they could the old way.

By Demon-Xanth on 11/12/2007 11:09:25 AM , Rating: 2
Setup a service with as much content as you can generate, make it easy to find things, and charge a fee for the DL amount. Say, $0.05/MB.

Why do I think this method is good? Because you can offer various quality levels and additional content, and capture more people.

Joe wants to try out a song, so he gets the 128kbps MP3 and pays $0.25 for it. (5MB)
John is an audiophile and wants the wave, so he pays $2.25.
Jill wants higher quality, but not so much as the wav, so she gets 320kbps and pays $0.75.
Sally wants the video, and pays $2.50.
Bob wants the HD concert video and pays $5

And if charged by blocks of say, $10 worth, you cut down on processing fees. If they make everything easy to find, easy to get, and the quality at something guaranteed, the reasons to DL illegally start to drop. It becomes more convenient to use the service. And it is flexible enough to allow additional content to be sold easily.

"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer
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