"Stop downloading my music for free!" That has been the near consensus view of the music recording industry throughout the era of online music dating back to the late 1990’s. The recording industry has reported billions of dollars in lost revenue due to online music sharing websites and programs such as Napster, Limewire and Soulseek. However, has the music industry missed the boat on just how much money can be recovered by taking advantage of this relatively new form of accessing music by their intended customers?
The most famous battle waged against the online music sharing *cough piracy cough* was the lawsuit filed by the RIAA against Napster at the start of the millennium. Metallica, yes the same Metallica that benefitted greatly from its loyal underground fan base in the 1980’s before the band became a major commercial success in the early 1990’s, was at the forefront, with drummer Lars Ulrich becoming the poster child for the lawsuit. Instead of embracing the inevitable, musicians at the beginning of the internet age chose to fight for every penny they assumed they lost due to online piracy. Radiohead, one of the biggest bands in the world since the early 90’s went in the opposite direction however. In 2007 the band released its 7th studio album via the web. “In Rainbows” was made available for download to fans on the band's website for a price of – whatever you would like to pay! Astonishing!
Now as you may know I am usually a strong proponent of making that paper (“generating revenue” for you older folk), but in this case I side with Radiohead in their approach to the new age of music acquisition. The band further endeared itself to an already extremely loyal fan base and though many people downloaded the “In Rainbows” album for free, the band still made paper in the present and generated enough buzz to enhance its money making potential in the future. According to a BBC News article in October of 2007, The band's spokesman Murray Chalmers said - “Although the idea is that you can decide what you want to pay, most people are deciding on a normal retail price with very few trying to buy it for a penny.” Radiohead also had a box-set simultaneously advertised for sale on the same website for a small price of £40 which added to the total sales of the album. The bottom line is online music sharing is not as bad as many in the recording industry think. The potential to save on promotional activities by cutting out the middle-man and gain in terms of fan loyalty (i.e. brand loyalty) and ticket sales at live events must be taken into account. Embrace the inevitable because any future restrictions placed on the music sharing industry (it is now an industry of its own) will lead to more innovative ways of beating the system. Capitalism rules!
The most famous battle waged against the online music sharing *cough piracy cough* was the lawsuit filed by the RIAA against Napster at the start of the millennium. Metallica, yes the same Metallica that benefitted greatly from its loyal underground fan base in the 1980’s before the band became a major commercial success in the early 1990’s, was at the forefront, with drummer Lars Ulrich becoming the poster child for the lawsuit. Instead of embracing the inevitable, musicians at the beginning of the internet age chose to fight for every penny they assumed they lost due to online piracy. Radiohead, one of the biggest bands in the world since the early 90’s went in the opposite direction however. In 2007 the band released its 7th studio album via the web. “In Rainbows” was made available for download to fans on the band's website for a price of – whatever you would like to pay! Astonishing!
Now as you may know I am usually a strong proponent of making that paper (“generating revenue” for you older folk), but in this case I side with Radiohead in their approach to the new age of music acquisition. The band further endeared itself to an already extremely loyal fan base and though many people downloaded the “In Rainbows” album for free, the band still made paper in the present and generated enough buzz to enhance its money making potential in the future. According to a BBC News article in October of 2007, The band's spokesman Murray Chalmers said - “Although the idea is that you can decide what you want to pay, most people are deciding on a normal retail price with very few trying to buy it for a penny.” Radiohead also had a box-set simultaneously advertised for sale on the same website for a small price of £40 which added to the total sales of the album. The bottom line is online music sharing is not as bad as many in the recording industry think. The potential to save on promotional activities by cutting out the middle-man and gain in terms of fan loyalty (i.e. brand loyalty) and ticket sales at live events must be taken into account. Embrace the inevitable because any future restrictions placed on the music sharing industry (it is now an industry of its own) will lead to more innovative ways of beating the system. Capitalism rules!
But come on you all have downloaded music online for free in the past so who am I kidding. Come on! You know about this!
Source: BBC News, October 2nd, 2007
I believe the music industry still doesn’t realize the potential of online music “sharing”. Adding to your Radiohead example, actually the album “Kid A” was leaked to the internet before its release. However their sales were huge and they hit place #1 on Billboard charts where they had never got to. Besides, sales are not only the physical sale of the CD with the copyrighted content, but they are also shows and concerts, posters and more paraphernalia. I don’t think the CDs account for the biggest part of revenues. So why haven’t other “big bands” taken the “Radiohead approach”? Maybe they’re afraid? I know several bands in Venezuela that have published their albums for free to gain a fan base and now they are up and running profits through other means, so why isn’t it possible everywhere?
ReplyDeleteGood point on the Radiohead example. Artists are usually drawn to a side based on pressure from their major labels. A band like Metallica decided to go after some of their own fans for spreading their music, when a band like Radiohead (who already had a strong niche in the underground music culture) decided to let their music speak for itself as a product and enabled people to pay whatever they believed to be reasonable. That sort of method probably wouldn't work well for a band that wasn't as established as Radiohead, but it is an interesting model for larger bands to consider when releasing new albums.
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