In Rainbows

There’s a lot of talk about artists being able to fully embrace digital distribution these days by forgetting about record labels and just selling their stuff on their own. Thanks to social networks and blogs, which allow artists to pick up fans a lot quicker, and the ability to easily embrace digital storefronts to sell tracks online and keep a higher proportion of the net, its a very appealing opportunity.

And I totally agree with that. In fact, that’s exactly why we’re doing what we’re doing at Sawce.

However, with Radiohead’s recent release of In Rainbows (which sold over a million copies in the first week with an average voluntary price between $5 and $8, depending on who you read), people are now taking the argument a step further. The major problem that digital presents to the music industry is obviously piracy. Though Radiohead hasn’t dodged the bullet on that one completely (even if they have managed to pocket much more than any other physical release they’ve done), thanks to letting fans pick their price, the argument goes that piracy is getting a little less relevant.

They say that by letting people volunteer what they think the value of the release is, rather than forcing one on them, people will be truthful more than not and actually pitch a fair value at the artist as a thank you for their good work.

And that’s fine, because music really does have different worth to different people.

The problem is this: music is a commodity with nearly infinite supply, and thanks to 24 hour days, 7 day weeks, and the fact that the average person makes money on some time-based denominator (either an hourly rate or some form of weekly, monthly or yearly salary), as soon as money enters the picture, demand isn’t quite so infinite.

My point is this: Radiohead did a good job, and they posted some impressive numbers by following the strategy they did. However, it’d be naive to think that it’d work so well on a mass scale, which is what a lot of discussion is hinting at as the reinvention of the economics of music (at least without some auxiliary stuff attached to it, which is one of the things we also happen to be working on at Sawce).

What they did was novel, not that many other artists are willing to gamble a release the way they did, and though I know a lot of smaller artists have been playing the model, no-one drew nearly as much attention as Radiohead. What they did was a water-cooler topic, and people talked about how much they spent (or didn’t spend) on the album. Music always has been, and always will be a social thing, and because of the buzz it created, it allowed Radiohead to capture a bit of a rent as people took relief in someone big doing something bold.

Fans may have been saying thank you for good work. But in a time where the record industry is pulling some incredibly (and also not-so-incredibly to by fair) haywire moves, its important to try to normalize for all the “thank you” they were getting for the good will (which if what they do becomes the norm, won’t get thanked for quite so often).

Here’s one more thing to think about:

• It was a visible play by a major band
• If it was going to be successful (which it was), fans would be able to expect other bands to follow (and they’d in turn be able to pitch their own prices at a lot more albums, and play the game over and over again, which would often be a lot cheaper than they would’ve been charged at the default rates).
• Enters the incentive to make the test case a brilliant success (which in turn means that the $5 to $8 average sale just may include a little premium from the expected savings that fans might be hoping to enjoy in the future).