Another Musician Recognizing New Business Models

from the about-time dept

Way back in 2003, I wrote up one potential business model for musicians who want to embrace file sharing, but who still want to make money (i.e., most of them). It was never intended to be "the" business model for embracing free file sharing, but it always seemed like a good one to me. While we've seen tons of interesting, innovative, unique and creative business models from musicians over the years, I still haven't come across one who completely followed the plan I described. The basics of the business model are easily recognizable to those who have read my series on economics, but it again, focuses on giving away the infinite goods and charging for scarce goods -- in this case, in the form of a "membership" or "subscription" that gets fans additional (scarce) benefits not available to those who don't pay the subscription. Thus, if you're a subscriber, you might get to come visit the musician in the studio, get early access to new songs, be a part of the song-writing process, early access to concert ticket sales or perhaps the chance to have the musician play a private concert for you and your friends.

The Penny Distribution blog has alerted us to the news that musician Kristin Hersh has actually adopted something very much like the model I described. Her plan is even a little more advanced, as there are different "levels" of membership with different benefits included. At the base level of $10/quarter (which still seems a bit pricey to me -- I would think that it would help more to have an opening level that costs less than a big record label CD per year), you get a sticker, a poster and a copy of her new CD before anyone else does. As the prices get higher, she starts to get more creative. For $30/quarter, you'll also get "a works in progress sampler CD" of new music that she's working on, plus you'll get yourself and one other person on the guest list for one of her shows. There are even higher levels of support, including one where you'd get to spend time in the studio with Kristin all the way up to getting executive producer credits on her next album.

I think this is definitely a move in the right direction -- and I'm hopeful that other bands will start to adopt similar policies. In this case, it feels like the prices are a little too high, and the benefits are a little too low, but it may depend on how popular the artist is (Penny Distribution says Hersh is popular -- I've never heard of her). Also, in her mission statement about the new model, she seems to be suggesting that this model is "principles over profit" where she's unlikely to profit as much through it. That doesn't sound right either. If you embrace this model properly, you should certainly be able to profit nicely from it -- as you can drum up a larger, more committed following who are more willing to pay sums of money directly to you, rather than filtered through a bunch of middlemen all taking their cuts.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    Ethan Bauley, Dec 28th, 2007 @ 9:04am

    CASH music v. ArtistShare

    Mike, check out these 2 interesting side notes re: ArtistShare [which as you know has been running with this model for years]:

    - ArtistShare has a patent pending on the entire concept of artists monetizing the behind-the-scenes/creative process. Add it to the list...

    - For a handful of the current ArtistShare projects, one of the "returns" to "subscribers" is an iPod full of music...which I strongly suspect is not fully licensed.

     

    reply to this | link to this | view in thread ]

  2.  
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    Keybored, Dec 28th, 2007 @ 9:29am

    Kristin is a popular "new age" artist. Good for her for embracing this new business model. I wish her sucess. http://www.throwingmusic.com/

     

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  3.  
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    High_Noonan, Dec 28th, 2007 @ 10:27am

    New Age?????

    Kristin is about as New Age as a swift kick to the crystals, if you'll take my meaning!

    She is a founding member of the 80's/90's college rock heros, Throwing Muses. She's released eight solo records and is working on a ninth. And, I suggest that any one who still thinks she is "New Age" to hit up YouTube for her latest band, 50FootWave. Not bad for a 40 year old mother of four!!!

    I am one of the many who have already signed up for her $30/quarter subscription plan and I seriously doubt I will redeem the "guest list" privilege, thereby putting even more coins in her pocket. She deserves it, having told Big Music to go stuff it MANY years ago.

    One thing that she is doing with her CASH Music plan that was not discussed above, is that she is releasing a new song every month on the site, complete with her Pro Tools stubs (released under Creative Commons, that is) for fans to remix and post back to the site. She is calling this the "Read/Write" model, and it has been pretty successful so far.

    Yes, I am a crazy KH fan, but I also read TechDirt everyday. I am very happy that you all have been following these new music business models as closely as you have. Keep up the good work!!

     

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  4.  
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    Matthew Galvin, Dec 28th, 2007 @ 12:31pm

    Throwing Music at Ya!

    Wow, definitely never heard Kristin described as "New Age". Check out her wikipedia article http://en.wikipedia.org/wiki/Kristin_Hersh
    in case you haven't heard her perform.
    $30/quarter seems a bit steep to me - that's a little less than what I pay for Blockbuster or Netflix. Considering recording and releasing an album costs maybe $100,000, while a movie costs about $10 million, I think there is probably some scaling to be done here.

     

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  5.  
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    listen_to_blogs, Dec 28th, 2007 @ 2:45pm

    Old business model for music - revenue split.

    Can someone throw light on the older business model for music? What percentage of the CD sales went to the singers/group?

     

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  6.  
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    Mike (profile), Dec 28th, 2007 @ 3:24pm

    Re: Old business model for music - revenue split.

    We've pointed to numerous accounts on that. Here are two:

    David Byrne notes that it's 10%
    http://www.wired.com/entertainment/music/magazine/16-01/ff_byrne?currentPage=all

    Courtney Love shows how even that math is funny:
    http://archive.salon.com/tech/feature/2000/06/14/love/print.html

    she uses an example where a band would officially get "20%" but in reality get significantly less than that.

    Basically, you make next to nothing from CD sales.

     

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  7.  
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    ChurchHatesTucker, Dec 28th, 2007 @ 4:17pm

    Sponsors vs. Freeloaders

    Yeah, if you grew up in the eighties, you probably know her, although maybe not by name.

    I am struck that Rooster Teeth, the "Red vs. Blue" guys, use a similar (but cheaper) model of sponsorship. AFAIK all you get is higher-quality versions of the episodes, and an occasional "sponsor-only" video (that usually ends up on youtube anyway) so the benes aren't huge, but they still have quite a base of sponsors.

     

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  8.  
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    I'd pay for a studio session, Dec 29th, 2007 @ 5:48pm

    Membership has its privilages

    I know I would gladly pay a membership fee to get preferential ticketing/backstage admission to concerts. And I know there are fans out there who would pay big bucks to get to do a studio session with their favorite band. I could see bands 'auctioning' studio time then giving you 'contributor' credit on a song for beating out a tempo on a drum.

     

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  9.  
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    Simon, Dec 30th, 2007 @ 3:26pm

    Just to add that Kristen hopes to open up the CASH Music model to other artists, as well.

    Also that fans can choose to donate via a tip jar if they don't want to subscribe; whether you donate or not, you can still download the songs as FLACs or MP3s. (Also interesting is the read/write model that high_noonan describes above).

     

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  10.  
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    High_Noonan, Dec 30th, 2007 @ 5:37pm

    Re: Simon

    Other artists are being rounded up. I know for certain that there is another female artist involved, but her name escapes me at present. Sorry. Sadly, her side of the site has not lit up yet. Others are definitely invited, this is not a KH only event. CASH (the "SH" part of which is fan derived) is all of a month old now!

    Tip Jar:
    That option is available, and always has been. On the cashmusic.org site, you can donate (suggested $3), but at throwingmusic.com, there is a tip jar that has seen some heavy usage.

    Also, KH is BIG into delivering not just DRM-free MP3 files, but FLAC and, as memory recalls, her 'Free Music' record from 50FootWave was also available in OGG. And it is free, as in speech and beer.
    http://www.throwingmusic.com/freemusic/
    Damn it, no OGG, but FLAC and FREE!

     

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