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MUSIC | Noah Brier

Looking at Music

Music paints a pretty accurate picture of what's going on in media at the moment.

November 7, 2007 | RSS | EMAIL | PRINT | 7 COMMENTS

About an hour ago I received this IM: "Can you write a bitchy response to this? i can't understand how this is a failure when the band is taking $2.26/unit when signed bands typically earn about $0.02-$0.10 per record"

The article in question, Most Consumers Grabbed 'In Rainbows' for Free, not surprisingly refers to Radiohead's In Rainbows which let people download the album for any price they chose. Numbers have started to emerge from the experiment and pundits everywhere are debating about its relative success.

My take: This very debate lies at the heart of the problem. Success, like just about everything else in the universe, is not a binary. Things are not either successes or failures, rather it's a relative measure based on a number of factors. (It's a very postmodern take, I know.)

Now when it comes to most articles, the focus is that 6 out of 10 people paid nothing to get the album, leaving the whole experiment with an average price-per-album of $2.26. The other half of the equation, however, is that of the 38% who chose to pay something, they "forked over an average of $6, with U.S. consumers paying almost twice as much ($8.05) as those from other countries ($4.64)." Now sure this is less than the cost of a physical album or download on iTunes, but maybe, just maybe, what people are telling us is that these things cost too much. Plus, has anyone asked what percentage of people actually pay for albums? Is it unreasonable to think that if Britney Spears sells 2 million records, another 3 million people steal it? (Sounds about right to me.)

Part of the reason I've been so focused on music lately is because I think it's a nice case study for what's going on in media generally. Here are a couple thoughts on how:

  • Music is stuck in a contradiction: While it's more popular than ever before (how many people do you see with white headphones), it's also less profitable in traditional terms (that is record labels are struggling).
  • Digital production has fundamentally altered the economics of creating music (garage band is a piece of software, not a bunch of guys with nowhere else to practice).
  • It's increasingly unbundled (the shift to a world of singles rather than albums is all but complete -- hink about all the people who listen to playlists or shuffle on their iPod).
  • Musicians are discovering it's not the size of the audience, it's what you do with them. (This is a lesson I've been explaining using NoahBrier.com as an example: I don't make any money directly off this site, however, the platform has allowed me to start things like likemind, which certainly have monetary value.
  • Finally, and maybe most importantly, the best distribution platform anyone ever built for it is free. Napster was better than any record store that ever existed. I didn't need to leave my house and I could get anything I wanted in seconds. Oink, which was a giant BitTorrent site that just got shut down, had everything on the planet in every format you could ever imagine. Even musicians liked it: As Trent Reznor of Nine Inch Nails explained, "I'll admit I had an account there and frequented it quite often. At the end of the day, what made OiNK a great place was that it was like the world's greatest record store. Pretty much anything you could ever imagine, it was there, and it was there in the format you wanted. If OiNK cost anything, I would certainly have paid, but there isn't the equivalent of that in the retail space right now. iTunes kind of feels like Sam Goody to me. I don't feel cool when I go there. I'm tired of seeing John Mayer's face pop up. I feel like I'm being hustled when I visit there, and I don't think their product is that great." Or, as DJ Rupture put it: "In many cases, I believe that downloading an album from Oink would be both faster (more on this in a bit) and give you more information about the CD than sites like iTunes."

As usual, I haven't really answered anything here, just added a whole lot more questions. But, as Terry Heaton so nicely put it, "Postmodernism offers no answers, but asks questions that might lead to answers, if we're willing to ask them."

Update (11/11/07): Keith makes a great point: "What I failed to realize when the news hit was, regardless of how much coin the band makes from the actual sales, they’ve just built a most impressive consumer database. In order to download the album, you must give your address, e-mail address (obvs), and mobile phone number!" Think about the value of a database of over a million of your fans. Amazing.

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COMMENTS

1Mike Arauz

This is all obvious, yet, amazingly, the corporations are still fighting it. The major labels just aren't necessary anymore. They use to play a useful role: funding the production of an album, distributing the record, and helping to connect artists to listeners. Now, artists can produce an album at home on their Mac. They can uploaded and distribute it through the web. And they can connect to listeners through any number of websites. And what does this cost? Very, very little. So as you say, success is relative. It simply an economic question of investment and return. The definition of success for a truly indie artist who produces, distributes, and markets on their own is very different than success for the major labels.

November 8, 2007

2Joey Roth

You make a good point, but: http://www.thecheezburgerfactory.com . . .

November 8, 2007

3amber

oh boy, do i have a song for you:

http://www.youtube.com/watch?v=0U573b653Sg

the video makes no sense, but if you like, I can give you the song tomorrow.

Incidentally, Idlewild's American, then British record labels went under recently, and although they aren't breaking up, they're certainly an example of what might happen to lesser known bands on smallish labels that don't have Britneys to keep them afloat.

November 8, 2007

4Andy

I also have a feeling that a lot of people may have 'bought' it for £0.00 just to see if it really worked.. including journalists and bloggers writing about it. I decided to steal it FIRST, listen to it and THEN decide how much to pay. But I stole it form elsewhere so I didn't feel guilty.

November 8, 2007

5Benton Jones

The result of the Radiohead campaign was very similiar to world renowned violinist Josh Bell's performance in a DC Metro station. Bell played his $3.5 million Stradivari and the results where astonishing.

"So, a crowd would gather?
"Oh, yes."
And how much will he make?
"About $150.""

It seems and correct me if I am wrong that stripping away marketing hype and the current trends music in itself is just not very valuable to the American consumer in dollars and cents.

Check out the videos/report here....
Pearls Before Breakfast

November 8, 2007

6chartreuse

There is no way it can be looked at except as a success.

What moves bands,and other products, are fans. In todays viral universe that's how things grow.

The RIO on this experiment was amazing. Greater than anything they would have made traditionally.

RH managed to get their music to fans and the curious.

And didn't lose a dime.

What can be more successful than that?

November 9, 2007

7Tangerine Toad

I have a good friend who works for one of the major labels and despite being a bright and fairly open-minded guy, he cannot get past the whole "but they're stealing music" thing.

Nor can the people he works for. They've never seen that the changing technology meant changing their profit structure and relying less on actually selling the damn CDs. (Mp3s)

Reznor is dead on but to elaborate, LimeWire and Napster also gave you access to songs you'd never be able to buy anywhere: bootleg recordings of concerts, odd cover versions of songs recorded during radio station appearances, etc. That's the bulk of what I downloaded off there.

iTunes is definitely Sam Goody redux (and you probably need to explain that Sam Goody was a middle of the road mall-based record store since I don't think they were a national chain, just metro NYC) - but they know their core audience is about 15 and so that's why you'll find Rihanna and the Jonas Brothers prominently featured.

I'm curious to see how kids who grew up with this format process music as they get older. Right now, my kids have no idea what a CD is, having only listened to music via an iPod. And the idea of listening to an entire album at once is baffling - you download the album to a playlist, you don't listen to it by itself. Now that may change as they hit their teenage years, but I'm not counting on it.

Enough rambling.

TT

November 12, 2007