Radiohead and Open Pricing

[Rich Tate]

I’m a huge Radiohead fan and I can tell you most of us were shocked to learn the new album was coming out literally days after its completion, and will be sold via open pricing online.

Normally a Radiohead release generates huge buzz as fans and critics alike wait to hear the latest musical direction of a band that has produced such varied offerings as the radio hit "High and Dry" to the experimental musings of "Kid A."

 

[MorfiusX]

It may or may not work, but at least they are trying to do something other than stick with the dyeing model the record industry has now.

 

[Ethug]

afaik I've never heard a radiohead song. I don't understand the buzz aside from the "pay what you want" thing.

 

[Manaknight]

while i'm not really a radiohead fan. This is a HUGE idea and something that i support 200%, this is probably the best idea in legal digital music i've heard.

i may actually have to buy this whether i like radiohead or not

 

[MetalDwarf]

so you just pay what you think its worth?
so if i thought the album was worth $1 i can just pay that?
good starting point but the bands wont make much of any cash from this setup. bands ilove i will gladly pay more but in all honesty the people who will pay the minimum will always outweigh those die hard fans with cash.

I propose a free market system, base it like a stock. each album opens on the free market at say $10. as more and more people buy it the "stock" price rises. the high popularity drives the cost of the album up. as long as the album is good enough and there is demand the price rises perhaps higher then a standard album release price. but if its good enough people will pay it. as interest drops off the stock price falls and when its been out for a while and much of the interest in it has been lost the stock crashes to like $5 an album. of course there would have to be some system devised to control how fast and how much the costs goes up or down. thoughts?

 

[Kiggles]

I would argue this is a good move for the industry, but there is no reasonable way to argue that total dollars earned is a good thing. I even think talented artists will be earning more with such a price model. Does it give people the opportunity to pay $15, $20, or even $100 for music they enjoy? Yes, but it gives everyone else the opportunity to pay $1, which can quickly offset the high rollers, as it were. Then again, it may get people like me who don't often listen to music to start.

Still, I don't believe the success of this model will be measurable in dollars.

 

[MH Knights]

There was an entire site a few years ago that had an open pricing model, Magma music or something I am not sure. You could stream all the songs of an album and then pay what you thought that album was worth. The catch is that there was a set price range, $5 to $15 was the usual one. You could order a physical CD or just do a digital download. I do not know how it worked out though.

More power to artists selling right to the customers though.

 

[Supercharged_Z06]

To those of you that aren't familiar with Radiohead, here are a couple Youtube links that demo a couple of their songs/videos:

The first one starts out really slow - give it a bit of time, lots of emotion in this song and the video is really different:

Street Spirit

High and Dry

I think they're talented musicians - very unique sound. Hope this new marketing scheme takes off. I like the concept.

 

[nilepez]

I would argue this is a good move for the industry, but there is no reasonable way to argue that total dollars earned is a good thing. I even think talented artists will be earning more with such a price model. Does it give people the opportunity to pay $15, $20, or even $100 for music they enjoy? Yes, but it gives everyone else the opportunity to pay $1, which can quickly offset the high rollers, as it were. Then again, it may get people like me who don't often listen to music to start.

Still, I don't believe the success of this model will be measurable in dollars.

They won't make more. Most shareware is never registered. People won't pay a lot for something they can get for free.

In my case, I'm very torn. I like Radiohead, but I despise paying for lossy files. Furthermore, I want a CD. i want a booklet (and Radiohead frequently has nice books). Unfortunately, the only way to get them on CD (at this point) is to pay something like $80.00 and wait for a set that comes with 2 CDs (1 is the downloaded music, the 2nd is bonus material), 2 vinyl records and maybe something else.

How about something in between there?

For those who actually buy form iTunes, this is a great thing, but I'd be much more inclined to pay more for it, if what I pay can be applied towards buying a CD (or better still a more reasonably priced 2CD set sans vinyl).

At a minimum, I'd like to see lossless files, but I'd rather have the shiny disk and rip my own flac files.

 

[nilepez]

To those of you that aren't familiar with Radiohead, here are a couple Youtube links that demo a couple of their songs/videos:

The first one starts out really slow - give it a bit of time, lots of emotion in this song and the video is really different:

Street Spirit

High and Dry

I think they're talented musicians - very unique sound. Hope this new marketing scheme takes off. I like the concept.

Though buyers should be warned that Radiohead hasn't made an album that sounded remotely like The Bends (the album those songs came from) , since the Bends (12-13 years ago).

I love most of the new stuff, but it's farmore challenging music than the Bends, though I think the rewards make it worth the effort.

 

[Cryptic1911]

I'm buying it when it comes out.. I like a couple radiohead songs, but I can't say that I'm a "fan", but I will be buying it to support what they are doing

myself, I think they are going to make a killing on this album from all the people like me, and it will make someone notice

 

[purple_haze]

i just supported it, ever since kid a i have never really liked their new cd since it got wierder and wierder but i still love radiohead. thom Yorkes solo album was mixed for me though. Oh well i just paid what i thought it was worth 5-7 and just pre-ordered the download tracks.

 

[kllrnohj]

I'm tempted to buy it for like $4-5 just to send a message that this is an awesome idea.

To all those saying they would only give $1 - it wouldn't surprise me if the artists makes less than $1 per CD sold at retail anyway, so Radiohead probably makes about the same in retail as they would if people pay $1 for the digital download.

According to http://www.music-law.com/contractbasics.html:

A band can expect an average of $1.00 in royalties for each full-priced ($16.98) CD sold through normal retail channels.

So even if they average something like $2 per digital download, that is roughly twice as much as they would make in retail.

 

[soja]

so you just pay what you think its worth?
so if i thought the album was worth $1 i can just pay that?
good starting point but the bands wont make much of any cash from this setup. bands ilove i will gladly pay more but in all honesty the people who will pay the minimum will always outweigh those die hard fans with cash.

I propose a free market system, base it like a stock. each album opens on the free market at say $10. as more and more people buy it the "stock" price rises. the high popularity drives the cost of the album up. as long as the album is good enough and there is demand the price rises perhaps higher then a standard album release price. but if its good enough people will pay it. as interest drops off the stock price falls and when its been out for a while and much of the interest in it has been lost the stock crashes to like $5 an album. of course there would have to be some system devised to control how fast and how much the costs goes up or down. thoughts?

I believe there's a online music store that works exactly like that. I forget the name/url though. Maybe someone here knows what I'm talking about.

 

[Finkus]

I love Radiohead and was really surprised to hear that they had a new album out next week that you could download for potentially nothing.

They are popular enough to be able to do this and it's really adventurous of them to break it down to a simple, "We're artists. If you appreciate our art then we're happy to receive any recompense." It's just not a viable option for most artists as our attention spans are entirely consumed by advertising, trying to push junk down our throats all the time and convincing us to part with our money for stuff that has no real value.

The music industry, like TV, film and unfortunately games, is almost entirely about large organisations making money with a very small number of artists that actually produce stuff worth consuming.

I hope they make more money than they would via the traditional route but only because I love Radiohead music. At the end of the day it's artists making music and money shouldn't be a motivating factor in its creation.

 

[MartinX]

I'm a Radiohead fan, and I like the flexible model, but I can't really see it working out in that form.

Radiohead are in a position where it really doesn't matter that much, they've made enough money at this point that they aren't playing to pay the bills anymore.

As pointed out, most noob bands are not in this position, they do need to make money to be able to continue, and frankly I don't trust that there are enough honest downloaders to genuinely pay "What it's worth" even if it's the best music in history.

Much as I hate the RIAA and it's tactics, the truth is that alot of music downloaders are the freeloading scum they are made out to be, not martyrs of "Fair Play" as they might wish to believe themselves.

 

[c.d.e]

I'm a Radiohead fan, and I like the flexible model, but I can't really see it working out in that form.

Radiohead are in a position where it really doesn't matter that much, they've made enough money at this point that they aren't playing to pay the bills anymore.

As pointed out, most noob bands are not in this position, they do need to make money to be able to continue, and frankly I don't trust that there are enough honest downloaders to genuinely pay "What it's worth" even if it's the best music in history.

Much as I hate the RIAA and it's tactics, the truth is that alot of music downloaders are the freeloading scum they are made out to be, not martyrs of "Fair Play" as they might wish to believe themselves.

Right, and how many non-top-40 artists on labels can actually pay the bills from their record contract and not a primary job?

 

[MartinX]

Right, and how many non-top-40 artists on labels can actually pay the bills from their record contract and not a primary job?

Please rephrase the question, that makes no sense.

 

[kllrnohj]

Please rephrase the question, that makes no sense.

Yes it does - he is saying artists who aren't in the top-40 need a "regular" job to pay the bills.

 

[john doe 182]

This is a genious move by Radiohead. The don't make much on album sales and just need a way to get people excited to go to their tour. They get major coverage by ever news channel for free while getting their message to their fanbase that probably doesn't even watch MTV anymore. (Not that MTV would have them.) This seems like a huge win for Radiohead and they are playing perfectly into their fans mentality.

 

[HardOCP News]

Odd that this hasn't gotten more press than it has. I reported on this two weeks ago when we first heard about it and nothing from the mainstream media.

After a week went by, there were scattered reports from the media, but nothing big. The problem with going against the industry is that the industry isn't too big on getting the word out. Imagine that.

Let's all keep our finger crossed that this album sells HUGE numbers.

 

[Lethal]

They won't make more. Most shareware is never registered. People won't pay a lot for something they can get for free.

In my case, I'm very torn. I like Radiohead, but I despise paying for lossy files. Furthermore, I want a CD. i want a booklet (and Radiohead frequently has nice books). Unfortunately, the only way to get them on CD (at this point) is to pay something like $80.00 and wait for a set that comes with 2 CDs (1 is the downloaded music, the 2nd is bonus material), 2 vinyl records and maybe something else.

I can see the $80 "collector's edition" being a hit with the group's hardcore fans. But I'm like you... I want to buy a normal CD with the artwork and booklet. I don't want to have to download and burn what amounts to a cheezy homemade CD to be able to play it in my car.

As pointed out, most noob bands are not in this position, they do need to make money to be able to continue, and frankly I don't trust that there are enough honest downloaders to genuinely pay "What it's worth" even if it's the best music in history.

Much as I hate the RIAA and it's tactics, the truth is that alot of music downloaders are the freeloading scum they are made out to be, not martyrs of "Fair Play" as they might wish to believe themselves.

I wonder how many of the group's "fans" will cheap out and just download it on P2P, because you know it will be available on P2P immediately after release.

Anyone remember "The Plant"? Some years ago Stephen King tried a new approach of letting people download his book in installments and use the honor system to pay for it. It started out with something like 75% of downloaders paying, then slid sharply. King abandoned the project. (article)

You also have to consider that promotion is a big expense for record labels. I haven't really seen anything on Radiohead's promotion strategy for this release. "If you build it, they will come" does not apply to music.

 

[MartinX]

I wonder how many of the group's "fans" will cheap out and just download it on P2P, because you know it will be available on P2P immediately after release.

...

You also have to consider that promotion is a big expense for record labels. I haven't really seen anything on Radiohead's promotion strategy for this release. "If you build it, they will come" does not apply to music.

Yeah, it will be kind of interesting to see if people are even bothered to pay the tiny CC charge, or will forgo the hassle entirely and just find a torrent.

For the business model, I meant to put this in my post but forgot and obviously couldn't edit, there really needs to be a baseline "Breakeven" charge that guarantees that at the least money won't be lost, to protect new artists.

Oh and you need to trust that people will be honest and altruistic enough to to take a fair and responsible attitude to compensating for the work...

Yeah, right.

 

[Lethal]

For the business model, I meant to put this in my post but forgot and obviously couldn't edit, there really needs to be a baseline "Breakeven" charge that guarantees that at the least money won't be lost, to protect new artists.

In the music biz, there are no guarantees. In fact, something like 90% of releases by major labels do not break even, let alone make a profit. When people talk about CDs being overpriced, they are usually thinking in terms of manufacturing costs and royalties, and fail to realize that 10% of a label's artists are supporting the other 90%. That has been the industry's business model for many years.

In many cases, the initial costs borne by the record label (hiring a big-name producer, hundreds of hours of expensive studio time, advances to the artists, tour support, promotion, etc.) push the overall cost of a release into the stratosphere so that even million-unit sellers don't turn a profit. The artist loses nothing, the label bears the risk and expense. It's a far cry from a DIY band recording on a four-track in their garage, touring in a single van and staying at Motel 6 and selling their CDs at clubs.

EMI's Guy Hands is taking note (article), which seems like a good sign.

Hands responded with an internal memo stating that the music industry has been too slow to embrace the digital revolution and that Radiohead's move was "a wake-up call" that everyone at EMI should welcome, but "respond to with creativity and energy."

Hands wrote: "Rather than embracing digitalization and the opportunities it brings for promotion of product and distribution through multiple channels, the industry has stuck its head in the sand."

The Terra Firma boss believes that other EMI acts and their managers will be following the Radiohead initiative closely to see whether such a business model can earn musicians more money than following the traditional record company route.

"Why should (established acts) subsidize their label's new talent roster — or for that matter their record company's excessive expenditures and advances?" Hands said in his memo.

Indeed, Hands appears to be willing to rip up the established record company business model in favor of focusing EMI on all aspects of the music industry. It is understood he is entertaining such ideas as having the company explore deals whereby EMI might subsidize the making of an album or fund a tour in exchange for a share in an act's revenues.

 

[nilepez]

I'm tempted to buy it for like $4-5 just to send a message that this is an awesome idea.

To all those saying they would only give $1 - it wouldn't surprise me if the artists makes less than $1 per CD sold at retail anyway, so Radiohead probably makes about the same in retail as they would if people pay $1 for the digital download.

According to http://www.music-law.com/contractbasics.html:


So even if they average something like $2 per digital download, that is roughly twice as much as they would make in retail.

A band like Radiohead would definitely get more than $1.00 per album. Established acts get 3x that amount or more.

But your point is still a good one, in as much as if you pay 3 or 4 bucks for the MP3s, they'll make about as much as they would have from a label.

My problem even then is that I can't convert that into a downpayment on a CD when it finally comes out.

I really hate supporting Lossy audio. My God, know self respecting live bootleg trader would deal with MP3s (most music torrent sites ban them), but here we have major labels and bands selling them.

I'll go downlaod it and see what I think, but my payment will be limited more by the medium than the content..

 

[nilepez]

Right, and how many non-top-40 artists on labels can actually pay the bills from their record contract and not a primary job?

How many of those artists are money losers for the Labels? Labels may be scum, but you'd swear that they make money off of the vast majority of artists, even though the converse is true.

Let's not act like they perform no service. If it was just a matter of recording your Music and putting it out there, then why are bands bothering to sign with labels? It's not that hard to record an album in a house or rented space if you've got a few thousand dollars of recording equipment. It may wont' be as good as some top notch studios, but it'd be passable.

The problem is you'd lack a top notch engineer and producer (though I'm not sure why, because everyone know they work for minimum wage) and you'll have no promotion, outside of the club gigs you play.

All of that stuff costs money, and most artists never make it. You can blame the labels for their failure, or radio or the bad taste of the public, but that's the way it is.

Besides, the entire argument about artists are underpaid is crap. People just want cheaper music (read free). People on Hardforum, when pushed, have said that the artists are overpaid too.

You want to support bands that are underpaid? Go to a club, or buy all of those new releases buy bands you've never heard of,so that they get a second album.

Stealing music doesn't help anyone (and by stealing, I mean you d/l and keep it....if you d/l decide you don't like it and delete, I'm more ambivalent).

 

[Azhar]

How many of those artists are money losers for the Labels? Labels may be scum, but you'd swear that they make money off of the vast majority of artists, even though the converse is true.

Let's not act like they perform no service. If it was just a matter of recording your Music and putting it out there, then why are bands bothering to sign with labels? It's not that hard to record an album in a house or rented space if you've got a few thousand dollars of recording equipment. It may wont' be as good as some top notch studios, but it'd be passable.

The problem is you'd lack a top notch engineer and producer (though I'm not sure why, because everyone know they work for minimum wage) and you'll have no promotion, outside of the club gigs you play.

All of that stuff costs money, and most artists never make it. You can blame the labels for their failure, or radio or the bad taste of the public, but that's the way it is.

Besides, the entire argument about artists are underpaid is crap. People just want cheaper music (read free). People on Hardforum, when pushed, have said that the artists are overpaid too.

You want to support bands that are underpaid? Go to a club, or buy all of those new releases buy bands you've never heard of,so that they get a second album.

Stealing music doesn't help anyone (and by stealing, I mean you d/l and keep it....if you d/l decide you don't like it and delete, I'm more ambivalent).

Seems you're glossing over some facts.. like labels pocketing what? 80-90% of the income? Sure, labels help band get on their feet, but ultimately it's up to the band to sound good enough for the public to care.

RIAA and record labels may be more justifiable in their existance if they weren't stealing so much from the real talents.. the musicians.

Hypocracy at their finest. RIAA condemns us for stealing music while it's ok for them to steal from the bands directly and indirectly.

 

[nilepez]

Seems you're glossing over some facts.. like labels pocketing what? 80-90% of the income? Sure, labels help band get on their feet, but ultimately it's up to the band to sound good enough for the public to care.

RIAA and record labels may be more justifiable in their existance if they weren't stealing so much from the real talents.. the musicians.

Hypocracy at their finest. RIAA condemns us for stealing music while it's ok for them to steal from the bands directly and indirectly.

And you just glossed over all the expenses. I'm not going to defend all of their practices, but I don't care if they steal 99% of the profits, if you download band X's album and don't buy it, you've stolen 100% of that bands profits from that sale and may cost them a contract.

You can fairly argue that bands initial contracts suck ass, but they choose to sign them. If as many claim, the labels are jsut thieves providing little or nothing for artists, then the artists have no reason to sign. That argument is just plain wrong. They may be useless for established artists like Radiohead, U2 and Prince, but without a label behind them, those artists never have gone the way of the Dodo, without nary a fossil to be found.

And not all bands sign dumb contracts. U2, for example, structured their original contract so that they got paid LESS. Why? Because they own the recordings. If they decide to move to another label, or strike it out on their own, they can take their catalog with them.

Prince didn't sign a contract like in the late 70's. I'm not sure how Radiohead's is structured.

Of course doing what U2 did, requires that you believe you're going to make it and that owning the masters is worth the lower early payout. Most bands don't do that. Hell, most just sign whatever. I feel sorry for those artists that got screwed 40 or 50 years ago, but bands from the last 20 years have no excuse.