Tuesday, June 9, 2009

Radiohead and The Money Thing

Composer and blogger Christian Carey brought up an interesting article in a Facebook post recently. Kim Gordon of Sonic Youth points out that Radiohead's offer of "name your price" downloads for "In Rainbows" was essentially a brilliant marketing tactic that only a band with such a huge following could employ. Others made a similar point when Trent Rezner self-published "Ghosts I-IV" two years ago.

Gordon goes so far as to imply that this strategy is a betrayal of fellow musicians, since it raises expectations for the availability of new music and lowers expectations of price. Most bands, including Sonic Youth, she points out, are really struggling to pay bills and can't afford to bring music to market without earning direct income from it.

The idea of giving away highly popular content seems to be limited to recorded media--film and music. In most of the rest of the art world, the content is tied to the medium in which it is created: a visual artist doesn't have an unlimited number of copies of a painting or a sculpture--he has one. When making prints, artists are careful to make only so many, noting each one's unique order in the print run. Then they destroy the plates from which the prints were made, creating a limited number of "originals" that can be priced accordingly. The total number of prints made this way (10? 50? 100? 1,000?) is purely arbitrary, a marketing decision that, combined with other factors like the celebrity of the artist, drives the price point for each print.

Nothing like that exists in popular recorded media. With the advent of digital technology, the media has become cheap and irrelevant, allowing sellers to price the product any way they want. Some of them, particularly in the world of DVDs, have chosen the standard capitalist model: the greater demand, the lower the price.

Consider this: If Radiohead were to follow the art world model, they would make a single, limited edition, high-priced product. Those who couldn't afford it would be encouraged to buy work of lesser known (and cheaper) artists, thus fueling the growth of the market. They could still hear Radiohead in concert, or on the radio, but they couldn't necessarily own a Radiohead recording.

This model clearly doesn't work in popular music. Pop music lives and dies on its appeal to the everyman. Even for Radiohead, it's very easy to alienate your audience with an ill-considered marketing strategy. Alienate your audience and suddenly you've got nothing.

When Rezner self-published "Ghosts," he used a tiered system, selling a limited edition vinyl box set at the high end and cheap downloads on the low end, with various packages, including a standard CD, in between. As a teaser, a way to cement his relationship with his audience and a way to grow his audience, he offered the first nine individual track downloads free of charge.

My guess is that elaborately tiered systems like Rezner's, which build on well-established marketing practices, will come to be the new industry model, with "free" as the entry level price point. But this model doesn't appear to address Gordon's main gripe: With bands like Radiohead giving music away for free, who's going to plunk down $12 for a Sonic Youth CD?

Was Radiohead's offer a betrayal? This is admittedly a difficult issue. Very big acts do have a responsibility to encourage the prosperity of lesser-known bands and help introduce them to new audiences. And very often they do, through production work, joint tours and recording projects. Could they also do so through their product pricing? Eh … probably not. The pop music world is fickle and the risk that a new album will fail is just as great for a monster act as it is for a club band--even greater perhaps, as big name bands tend to invest more in a product and employ a lot more people.

Gordon was certainly right about one thing: Radiohead's strategy was an effective stunt. For any band to follow that model exclusively, it would need consistent access to a huge potential audience, many of whom would be happy to take the music for free. Even Radiohead wasn't ready to make that commitment. It helps to remember that the band's decision to release it's "In Rainbows" as a "pay what you want" scheme was followed relatively quickly by the establishment of a regular price-point, matching the industry standard. And they made a killing.

Eventually, all recording artists will have to come to terms with the Rezner model, to the degree that they are able. Whether they self-publish or not, they'll need to offer a few tracks free--maybe even only one--to generate interest and bond with their audiences. The rest will have to be priced at the industry standard--the same standard that applies to the biggest stars out there. Creating higher-priced versions of the same recordings offers a way to increase return on investment while rewarding a die-hard fan base. Meanwhile, audiences are already becoming intuitively aware that only the very popular bands and hobbyists can afford to give away all of their music.

The bright side is that once they have learned their lessons from Radiohead, Rezner and others, record labels should be a lot leaner and a lot more inclined to support the artists they represent. Where they are not, self-publishing and self-promotion are viable options. In either case, the artists will likely be called on to invest more in return for greater control and greater potential for profit.


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