Cash at the end of Radiohead's rainbow?

[Editor's note: One of the (many) great things about having OJR at USC is the information we get from our students about what is happening in media today, under the radar of media executives and mid-career news reporters. This story is one such example. It deals with the music business, but the business model practiced here offers intriguing possibilities for other content businesses, including news. -- Robert]

Has the light gone out for you?
Because the light's gone out for me
It is the 21st century
It is the 21st century
--"Bodysnatchers" by Thom Yorke/Radiohead [In Rainbows, 2007.]

Can a major rock band turn out a profitable album without a major label to back it? Can said band sell the album as a legal DRM-free mp3 download? Can said download still make money even if users themselves are allowed to choose how much they are willing to pay? (No really, zero bucks is okay.)

Well, if the band is Radiohead and the album is In Rainbows, the Magic 8 Ball says 'Yes.'

As has been widely reported and blogged about, the album logged 1.2 million downloads on its first day. How much did people pay? I paid £3 (about $6). (Hey, I'm a grad student.)

Rumors, polls and inside sources circulating indicate that the average buyer paid £4, or about $8, which would mean that Radiohead has made about $10 million or more since the record's release on Oct. 10.

With numbers like that, and self-released digital downloads in the works from Madonna and Trent Reznor/Nine Inch Nails, some are claiming that the major labels are hearing their deathknell.

This so-called "anti-marketing" has lead Pitchfork Media reviewer Matt Solarski to wryly suggest that "they’ve turned this into a moral question of sorts, by giving us the freedom to pay actual money for what amounts to an album leak. Only a band in Radiohead’s position could pull a trick like this. Well played, gentlemen."

Nonetheless, the entire experiment may have been a simple ploy to raise sales of the actual CD release, coming in January of 2008. The mp3s are 160kbps--middling quality--so perhaps Radiohead hopes that fans of the album will shell out for the disc.

Radiohead is among the last big-name bands that has resisted releasing their material for paid download from Apple's iTunes store.

Radiohead's Jonny Greenwood told the Gothamist blog: "We talked about it and we just wanted to make it a bit better than iTunes, which it is, so that's kind of good enough, really. It's never going to be CD quality, because that's what CD does."

All this after another strange online event, the appearance of a phony countdown site to the album that turned out to be the world's most epic rickroll. (If you just clicked that, you really need to use the Interwebs more. Here's what a 'rickroll' is.)

Amazon.com and PayPal, among others, for years have been offering publishers the ability to put out online "tip jars." PBS long ago established a reasonably successful business model that relies in part on consumer's donations. And services like Priceline have applied the "name your price" model to online travel sales. But Radiohead's apparent success with its In Rainbows release might tempt other content publishers to consider voluntary pricing models. (Of course, not even making the album free can stop piracy; In Rainbows is Piratebay's 25th-most popular audio torrent right now.)

In any case, the record is hugely popular, cheap or free online, and creating tons of free buzz for the band. Radiohead guilts us into paying for something that we could have for free, and then slams us with a higher quality CD release a few months later, will inevitably sell out their tour dates... and (most of us) love them for it. I still think Amnesiac is their post-OK Computer high point, but that's another debate... until then, enjoy the new profit model, the newly romantic balladry mixed in with Radiohead's typical post-pop existential dread and the fact that you gots it all for cheap.

(In Rainbows reviews, from MetaCritic.)

Related stories: management, revenue

Blog responses: Technorati Google Blog Search

Share this page: E-mail to friend del.icio.us Digg Newsvine Reddit StumbleUpon

This article has been archived and is no longer accepting comments.