Radiohead say: “Pay as little as you like”
In an unprecedented move, UK-based band Radiohead are offering their new album online — without the backing of any record companies — with fans paying as much or as little as they like, says Zero Paid.
Fans can log onto the site and ‘buy’ the download. The price paid is specified by the downloader; a 45p (~1$) credit card processing fee is added onto whatever price they deem appropriate. Is this a brave move, a stupid move, or one that simply spans all boundaries of genius.
Definitely it’s a brave move; the royalties that would be paid by a large producer for an album by the obscenely popular Radiohead would be astronomical. They’re setting themselves up for a financial fall, here, as many people will be more than happy to pay 1p for the album. Which leads to the next question: is the move a stupid one?
Undoubtedly not. They may lose money on album sales… although possibly not, too. Many more people will buy the download than would otherwise buy a CD of the album, and a massive increase in sales means a massive increase in revenue. Plus which they don’t have a record company to pay, distributors or marketers (this news is as ‘viral’ as it gets). When you consider that artist’s royalties accounts for about £1.36 of an £11.61 album, the numbers start to make sense.
The band will also gain a huge number of listeners that they would not otherwise have. From these additional listeners come people who will purchase their back-catalogue; people who want to pay lots of money for their sell-out gigs, and people who want all sorts of other merchandise. The marketing for the band itself may be worth it alone.
Further, as album downloads are tracked for the UK charts, expect to see Radiohead at number 1 for a long, long time.
This is a very interesting move in the industry, and one which may well see it changed, if not turned on its head. Record producers should be very worried.
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Kylie Embraces Digital Revolution — Shuns Record Companies | Ares Free Music Downloads 29Nov07
[...] Radiohead recently made the big — and very brave — decision to release their latest album In Rainbows online, and to charge only as much for it as the fans wanted to pay. You think it’s worth nothing? So be it, the band say. We think this is a stroke of marketing genius; more than that, it is a very clear message to the large media companies that their time in the traditional role of agent and marketer are terminally numbered. [...]