Radiohead's experiment: Success or failure?

E Online reported that two-thirds (about 62%) of the people who downloaded Radiohead's new album, In Rainbows, didn't pay a single cent for the recording. The number of people who downloaded wasn't given. On average, worldwide people paid $6.00. Some analyst at comScore, the company that did the measuring, estimated that Radiohead needed on average $1.50 per download to break even, so for the people who think the experiment was a failure are wrong. Any way you look at it Radiohead came out ahead.

They made a profit. That's one thing. Just by releasing the recording themselves they've probably made more money than they would have through a label.

And that that profit depended on people paying while other's didn't is something interesting to look at. How long will the value system of this part of Radiohead's audience maintain this level of responsibility? Will guilt and a sense of fairness rule, or will they eventually change (I almost wrote erode) to equal the rest of the audience? Like water seeking it's own level, where will the volunteered price level out to? Radiohead is on their way to finding out.

It is like a little scientific experiment, with Radiohead changing and refining the criteria to fine-tune results. If Radiohead is smart, they'll continue to along this road to see where it takes them.

And what does this all mean for artists with a smaller fan base and less money? Nothing. It means sit and wait and watch and see what breaks out of this. The only thing smaller, lesser-known artists can do right now is continue to guerrilla market. Get their songs out in front of the public any way they can, but avoid the big labels right now because they'll only try to screw you into locking into a long-term contract. Find a smaller label that fits your vision of your music.

Radiohead distributes In Rainbows on Web, pay what you want

Is it the final nail in the music industry’s coffin? The end of CD sales? A giant leap forward in the way music is distributed?

The answer to all the above is no.

First of all, it was interesting that this news came through the arts side of the news business, and not from business writers. This is a business story, not arts news.

Radiohead’s decision to distribute their latest album and let people pay whatever they want is just a little experiment to see what will happen. Because the simple truth is no one yet knows what to do with this thang called the Internet, especially when it comes to the music industry. But the one thing we do know is this: It’s one heckuva delivery vehicle. (More on this later.)

Radiohead’s decision to let people pay what they want is an interesting choice. It’s like busking over the Internet. Instead of playing in subway stations and city squares with an open guitar case, they’re letting people decide how much spare change to part with using their Visa cards. Interesting. Radiohead can do this because they’re established. They can experiment a little with their cash flow, or so I’m assuming. They’re cool, ‘cause they’re not signed to any record contract, so it looks as if they’re independently probing different business models with the Internet as the foundation. Smart.

And asking people for something, anything, is a nice little gesture, again, a nice little experiment because the age of getting free music is here, and sorry, RIAA, it’s here for good. There’s no getting around it. If anything, Radiohead’s pay-what-you-want policy might set the baseline for downloads. Let the people decide what’s fair. (Democracy is still very much alive on the Internet.)

Big fat record execs had it made for a long time because there was no mechanism for efficiently copying and distributing music. But that sort of idea has been around forever. I’m a writer. I write a book. You buy my book and like it, what do you do? You pass it along to a friend. You don’t say, hey, that’s stealing. Or you don’t even buy it; you go to the library and borrow it. You like something in it, you go to a copier and print out one, ten, a hundred copies of the passages. There have been copyright laws in place forever but no one ever paid any attention to them. That’s been the writer’s life.

Then came the Internet and kaboom…(see the notation above about the ‘Net being a delivery vehicle on steroids.) The music industry just was in the wrong place at the wrong time…sorta. I say sorta because business and technology are always changing and it changes fast and big.

But the record execs were too busy counting their money to see the paradigm shift. The Internet was coming down the tracks like a locomotive and they either didn’t see it or understand it to begin with. Probably the latter. And now they’re crying piracy and trying to make us all feel bad with their moralistic stance (it’s stealing! Stealing? What do you call pricing CDs way over the cost of manufacture and distribution just because you’re greedy?) The simple fact is they weren’t quick enough to change. There’s still money to be made. Tons of it. In concerts and promo items like forty dollar t-shirts and eight dollar cups of bad, water-down beer. Music is now a commodity, sad to say.

Nashville has the idea, sort of. Not that I like any of the music that comes out of Guitar Town, but the town loads up with great studio musicians and songwriters and matches them up with country singers. They turn them into a product no different than dish detergent or toothpaste, a product that can fill stadiums with forty dollar-t-shirt and eight-dollar-a-beer-buying fans.

Other musicians take other routes. Alt/indie folks gets their music in the fans' hands any way they can, realizing that a good way to build a fan base is in the philosophy that if they hear it will come. Forget FM drive-time play. Get your song played on Gray’s Anatomy or some show about blondes in southern California and you got a hit. You’re not a musician if your not giving your fans access to your music for free on MySpace.

It’s all just part of the wild crazy way musicians are living today, and thank God it’s starting to put some control back with the artists.