Radiohead new album: A business model for the future?

[Carpathian Psychonaut]

So, here's the way they're doing it:

£40 buys you the new album "In Rainbows" on CD, a second CD of tracks, the album on double heavy vinyl and a nice book/box container for it all - you get this, made to order, in early December. It also includes a download code for Oct 10th so you can get the album with everybody else.

That's not the unusual bit.

Those choosing just the digital download, comprising of the album contents of the main CD only, get asked at time of order how much they want to pay for it and can put in any value they decide, including £0.00, and just get a 45p handling cost at most.

So, is this a clever strategy to get even just a few pence for what they know will get p2p'd after release, a stunt to wake up the market or something dreamt up after too many beers?

Discuss.

[smiscandlon]

Let's tag on another question.

If The Sisters of Mercy did exactly the same, how much would you pay for the digital download...?

[mh]

Let's tag on another question.

If The Sisters of Mercy did exactly the same, how much would you pay for the digital download...?

A tenner sounds fair to me, but the question is academic as Von's mindset in this regard is apparently still firmly rooted in the past.

[lazarus corporation]

I think Radiohead's "open pricing" model will completely disrupt (in a very good way) the old business models of the record industry. I'm not a Radiohead fan, so this is purely a reaction to this business model, unbiased by any liking of their music!

I think mh is right, unfortunately - Von seems far too rooted in old (failing) business models to think about something as strategically innovative as this.

And in answer to Steven's question - I'd pay about five quid for a digital download of the next Sisters album if I could choose the price. But I'd pay three times that for a lovely card digipack with nice inlay stuff because I'm a fan.

(and Radiohead have taken this into account when they offer the £40 box set with the extra CD, thick vinyl 7" etc)

[BillyBadBreaks]

Let's tag on another question.

If The Sisters of Mercy did exactly the same, how much would you pay for the digital download...?

A tenner sounds fair to me, but the question is academic as Von's mindset in this regard is apparently still firmly rooted in the past.

A million pahnd squire, 'cos I don't think he will ever put anything new out

[eotunun]

£40 seems a thing for the die hard fans. I can't imiagine the average customer to be willing to cough up that much just for an album.

Will 45p save them from p2p-nicking?
I guess you have to pay them by credit card. Do you have one? I don't. And I don't even know if anyone of my friends friends had one, very likely the answer is no. So there's a problem for that version. p2p is only a minute of googling away. That won't solve the issue. Online banking is slow, PayPal slower..
But generally I think it shows something different: Do you remember that Eldo got offered 0.01 cent per download of one of his songs? That's 1.2 cent for the Floodland reisue.If the bands found a way to offer the downloads themselves they could gain A LOT comparing to what they have now.
And given a handy, safe and fast way to do the payment, would you hesitate to pay 50p for an album of which you know it's not bad? Then, would you think about buying it as CD for £10? Me, I would.

That pay-as-you-will option looks fairly odd to me though. A marketing gag,

[Johnny Rev 7.0]

I also saw this today and do admire what Radiohead are doing.

If you want the tangible Box Set then as a fan you'll pay for it and there's millions of fans who will. The download option is probably for the curious fan who may get hooked and then purchase the back-catalogue in tangible form.

I guess the Sisters die-hards would pay for a box set. The rest of us would download it for free having felt cheated over the years.

It's the difference between a band who had potential and worked hard and finally realised that potential.

As opposed to a band who had potential. And didn't.

[Johnny Rev 7.0]

£40 seems a thing for the die hard fans.

Of Radiohead? Currently ranked as the 7th most popular band on the planet? I guess there's only a million or so die hard fans. Radiohead know what they're doing to make a buck and tout for a future record company who will throw money at them after this success.

As opposed to the ever so frequent questions: "Sisters of who?" or "Are they still going?"

Different leagues my friends, different leagues.

[Ahráyeph]

I fail to see why this is so revolutionary. The often scoffed Marillion have been putting their last albums together with money provided for by their own fans, who in turn got thanked in the maxi booklet accompanying the new CD. All this because a) their American fans financed a tour to get them to play the U.S. and it got them to think, as they were without a label at the time. They just said : "Listen, this is what we need to finance the recording and manufacturing of a CD (they put up their own studio and label with that money and paid for the production cost as well as the manufacturing of the CD's), will you help us out?" And the fans did. The CD was sold to them at a very competitive price and they got their names (yes, each and every one of them!) in the booklet. And the packaging was better than your average CD as well ánd it came with a bonus record. They relied on labels to do the normal distribution, but in all, the fans financed the albums and got a lot in return. The downside to all this? You first need to have a strong fan base, so I don't see this working for new bands...

[Izzy HaveMercy]

I fail to see why this is so revolutionary. The often scoffed Marillion have been putting their last albums together with money provided for by their own fans, who in turn got thanked in the maxi booklet accompanying the new CD. All this because a) their American fans financed a tour to get them to play the U.S. and it got them to think, as they were without a label at the time. They just said : "Listen, this is what we need to finance the recording and manufacturing of a CD (they put up their own studio and label with that money and paid for the production cost as well as the manufacturing of the CD's), will you help us out?" And the fans did. The CD was sold to them at a very competitive price and they got their names (yes, each and every one of them!) in the booklet. And the packaging was better than your average CD as well ánd it came with a bonus record. They relied on labels to do the normal distribution, but in all, the fans financed the albums and got a lot in return. The downside to all this? You first need to have a strong fan base, so I don't see this working for new bands...

Now THIS I can understand. It is the 'tip jar' principle. A lot of independent writers work this way.

They put up a teaser on their website, and then you can start donating by PayPal into the tip jar. When it reaches an aforementioned quota (1000 euro for example) the writer start writing.

You get a copy for free and if you donate more than, say, 25 euro, your name gets mentioned in the book as well as the website of the author.

The thing Radiogead does will not work in the long run. Why go through all the hassle of paying for a product when you can download it (illegally) for free? People into illegal downloads won't even bother going to the website. This only works for live concerts (Pixies anyone?) and even then....

Nah, I still think the ARF solution is very cool Start coughing up some cash for the FGG album

IZ.

[eotunun]

You first need to have a strong fan base, so I don't see this working for new bands...

A successfull video on Youtube may start enough interest to sell an easily available file in numbers. That may enable startups to get CDs in numbers made and sold. Without the farting around of salesmen.
All it required would be a server and connection with some punch and the payment system that delivered the file to the right adress.
Sticking a virtual surface to a virtual monster to have fight virtual battles in a virtual world seems more difficult to do to me.

[lazarus corporation]

Let's tag on a third question.

If MyHeartland.co.uk did exactly the same, how much would you pay for an annual subscription...?

(slightly tongue-in-cheek as it's already funded by us choosing how much to donate - and QB's wallet, of course)

[Johnny Rev 7.0]

Well ... at the risk of offending some bands less well known than Radiohead and going back to Carpy's original question, it is revolutionary!

For example, Trent's/NIN contract with UMG has one more album to run. YZ Remixed? That's the word I hear and then he can do what he wants so I guess he'll be following the success, or not, of this.

But top bands perhaps don't quite realise the work (behind the scenes) that goes into making an album. Maybe Radiohead have which is why they're touting for a new record company?

I'm just throwing ideas.

[Ozpat]

...and I like reading them Johnny!

[Carpathian Psychonaut]

I think the difference between this and 'the Marillion method' (which was a good addition to the conversation) is that they raise the money needed to make the album, whilst this Radiohead one is already made, mixed and finished - they've involved the choice part in purely pricing the files to all and sundry.

Personally, I think it's a smart move to get x times £something with no physical distribution costs, versus nothing at all via p2p. They know it's going to be on there but to give the fans chance to do it through the site (whether via loyalty, novelty or whatever) keeps a small hand in the mix.

The fact we're talking about it on here says something, I guess.

[Dark]

Didn't Neubauten do something like this with a "supporters' album" or something?

Yeah, everyone's said everything I would. The "tip jar" approach is a good idea, but a band needs a fairly advanced/appreciative/generous fanbase in order to successfully pull it off.
For instance, if I were to say "I need £300 to release our first 7" single", I'd probably get a few quid and a few laughs, whereas if I say "I need £30 to put out the CD EP" I might actually manage it. Any more than that, and I'd not raise enough from that alone. So an established fanbase is vital for raising ~£1000 for an album.

[Dr. Moody]

Trent says steal away (if your australian or chinese)...

http://www.zeropaid.com/news/9020/Trent+Reznor

http://www.boingboing.net/2007/09/13/tr ... -chin.html
also what about the Neubauten subscriber approach ?
and the hardrive of soundboard recordings from the whole tour,
@:von: one of those please.

Surely the process of being independent is more viable than ever ?
specially with the kind of fanbase that can make a (last minute ?) world tour without any release or promotion still possible.

Dont see why Radiohead need a label anymore either, they must be rich enough at this stage to finance anything they want to do.
quite like the idea of buying vinyl with attached free mp3 download code.

actually nix that, maybe we should do away with fancy packaging altogether.

[gudge]

IIRC Radiohead do not have a contract and are therefore their own masters in their destiny,not beholden to anyone. They also have an exceedingly large fanbase that goes to gigs and buys merchandise and it is this that they are playing on. A digital download for nowt(if you want)but a new product to promote within the live arena.
It is a brave step forward Radiohead are taking for themselves but an almighty 2 fingers to the record companies.The Charlatans have announced a similar idea for their new album due in 2008.Trent Reznor has already shown his disdain for corporate dealings by leaking the Closure DVD and making Year Zero available for free to those willing to follow his viral marketing campaign and so with his release from Universal i can see him taking distribution to a whole new level.
There are several bands that have released new albums for free via download-Monsterworks,Story One and it got them a good deal of free promotion.
It will be interesting to see how this pans out,is brave enough to take the plunge?

[6FeetOver]

I don't think "bravery" (or lack thereof) is necessarily 's issue, here...

[mh]

I don't think "bravery" (or lack thereof) is necessarily 's issue, here...

Likewise.

The crucial difference mentioned some posts back is that Radiohead are well established, and can afford to do something like this. In the case of the Sisters, we would be looking at a band virtually restarting from scratch so far as releasing material is concerned.

Not that releasing on-line would be a bad thing, it's a distribution channel that has been proven to work on many occasions in the past. (Similarly with fundraising from the fans a-la Marillion.) But releasing for nowt would be a colossal risk in the Sisters current position. Unfortunately, we'll never find out either way.

[lazarus corporation]

I just pre-ordered a copy for the hell of it. I decided to pay £3.00 (plus the credit card processing fee of 45p).

I've spent that much on a pint of beer and pissed it up against the wall 5 minutes later, so it didn't seem like too much to gamble on 10 unheard mp3 files (and at least I'll remember spending this come tomorrow morning), but at the same time contributed towards the musicians' time and effort (and with none of it going to a record company or the evil RIAA).

[lazarus corporation]

I don't think "bravery" (or lack thereof) is necessarily 's issue, here...

Likewise.

The crucial difference mentioned some posts back is that Radiohead are well established, and can afford to do something like this. In the case of the Sisters, we would be looking at a band virtually restarting from scratch so far as releasing material is concerned.

Not that releasing on-line would be a bad thing, it's a distribution channel that has been proven to work on many occasions in the past. (Similarly with fundraising from the fans a-la Marillion.) But releasing for nowt would be a colossal risk in the Sisters current position. Unfortunately, we'll never find out either way.

I don't think it's lack of bravery, I think it's a lack of understanding/engagement with production/distribution economics on a hyper-efficient distribution platform.

We already know (from the official site) that they now record and mix their songs on a PC - removing the overheads of studio rental. There's no record company to pay. And with internet distribution of electronic file formats, there's virtually (no pun intended) no distribution costs.

No record company is going to give Eldritch £3million (or whatever he was asking). A million people are not going to be buying the next Sisters album - not at the standard £15 CD rate, and those are the types of numbers record companies think in.

However, a million people *might* decide to pay £3 (or whatever they think fair) to download a new album - people who have never heard (of) the Sisters. They might even decide to pay £0 (plus the 45p credit card processing fee). If they don't like it, then it's no loss - the cost of delivering one digital copy of an album is negligible. If they do like it - even if they decided to pay £0.00 - then there's a chance that they'll go see the Sisters next time they tour, increasing revenue from the tour (and merchandise sales etc). That way Eldritch could get his £3 million.

[Carpathian Psychonaut]

I just pre-ordered a copy for the hell of it. I decided to pay £3.00 (plus the credit card processing fee of 45p).

I went for £3.33 earlier but then had the 45p spoil my nice funky number

By all accounts, the webstore was creaking under the hits earlier today and even caused Jonny to post an apology for how slow it was on their blog. Be the idea mad or genius, it's certainly stirred interest. Clever, for sure.

[DerekR]

The Charlatans have announced a similar idea for their new album

They have indeed.

clicky

[Spigel]

In the latter half of the last century and group by the name of Crass did something similar with their vinyl releases. You where asked to pay no more than something like 3.99 for an album.(it was a long time ago so I don't remember too well)The art work was pretty good too.Each cover folded out into a poster. I was a about 10 years old at the time and they used to scare the bejazus out of me but my older brother thought they rocked.