Cure Singer Blasts Radiohead, Saying Name-Your-Own-Price Can't Work; Apparently Unaware That It Did Work

from the it's-not-like-the-info-isn't-out-there... dept

While we're not huge fans of the pure "give it away and pray" name-your-own-price business model, it still seems pretty ridiculous to see people like The Cure's Robert Smith blasting Radiohead for its experiment, claiming "it can't work" (thanks to Chris, for sending this in). Smith is uninformed on a number of different fronts. First, so many people get so focused on the "name your own price" part, that they forget that wasn't the only business model at all. That was just a part of the business model. At the same time they announced the pay-what-you-want downloads, they also announced an impressive boxset that cost quite a bit. Furthermore, contrary to Smith's assertion that "it can't work," it did work. In fact, it worked phenomenally well. The band sold more albums than it had in the past and it made more money. Actually, as the article points out, that Radiohead album did much, much better than the Cure's last album. Oops.

All of that info came out months ago. Apparently, Smith was too bothered "violently disagreeing" with Radiohead to notice how much money the band was pulling in. He also might want to brush up on his economics. His explanation for disagreeing with Radiohead confuses price and value drastically:
"You can't allow other people to put a price on what you do, otherwise you don't consider what you do to have any value at all and that's nonsense. If I put a value on my music and no one's prepared to pay that, then more fool me, but the idea that the value is created by the consumer is an idiot plan...."
Which, of course, has it backwards. If the music had no value, no one would want it, free or not. And, it's not that fans are "creating the value" in setting the price, it's that they're deciding how much they want to reward the artist. That's all. Perhaps instead of spending so much effort violently disagreeing, Smith should spend some time understanding the actual business models being put to good use by many different musicians, sometimes allowing them to do much better than the Cure... even if the music is "free."


Reader Comments (rss)

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  1.  
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    Ima Fish, Feb 27th, 2009 @ 10:11am

    Sure the Cure had a bunch of catchy songs back in the 80s. We all loved them for what they did.

    But let's face it, no one, I mean no one, ever considered the Cure "a thinking man's band." They were essentially the Poison of alternative music. Pointless make-up, weak metaphors, sub par musicianship, and ear candy without any substance.

     

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    Ima Fish, Feb 27th, 2009 @ 10:16am

    Mike, you missed the best part of the article. After Smith ranted about how you can't give stuff away for free, the end of the article ended with these two hilarious paragraphs:
    You can get an album of Cure-cover versions, by other artists, free with this week's NME, interestingly.

    The Cure also performed their entire 4:13 album at a free gig in Rome, in October 2008. Watch here. For free.

    The author of the article, Michael Leonard, apparently has a great sense of humor and irony!

     

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  3.  
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    Anonymous Coward, Feb 27th, 2009 @ 10:17am

    Boys dont cry

    but they seem to whine alot.

     

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  4.  
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    Ima Fish, Feb 27th, 2009 @ 10:21am

    Re:

    "the end of the article ended..."

    God, I really have to hire an editor. ;-)

     

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  5.  
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    Rebel Freek, Feb 27th, 2009 @ 10:21am

    Re:

    That is a good for the Cures music... Free from others... They probably made it sound better too...

     

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    Technage, Feb 27th, 2009 @ 10:30am

    It's pretty disappointing to hear this I like The Cure :(

     

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  7.  
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    labtecguy, Feb 27th, 2009 @ 10:36am

    Almost finished

    Now if only Morrissey would weigh in on this issue we could finally settle it once and for all!

     

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  8.  
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    Gwapito, Feb 27th, 2009 @ 10:58am

    Keith Green did this

    Keith Green (http://www.jqr.org?keithgreen), an unusual gospel singer in the 70s to 80s already did this. It was basically name your own price. Some people bought his album for free, some 1$, some paid $5000 an album. So it's not new.

     

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    Ima Fish, Feb 27th, 2009 @ 11:06am

    Re: Almost finished

    God, I was thinking the same thing!

     

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    Anonymous Coward, Feb 27th, 2009 @ 11:10am

    What I find interesting is how many musicians fail to recognize the promotional value of their own music. How many concerts would you attend if you hadn't already become a fan from hearing the music for 'free' on the radio/internet/tv/movies? Most acts make money from touring, not album sales so it makes little sense for them to place much value on the sell price of an album/track. The value of the music for the musician is to promote the act so folks will pay to see them.

     

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    Anonymous Coward, Feb 27th, 2009 @ 11:11am

    Perfect example of the need for record labels (or some other kind of representation) for artists.

    Let the artists be artists. Let the business modelers be business modelers.

    Why the assumption that these two kinds of functions should necessarily be encompassed in the same person or entity?

    Everyone does realize that Robert Smith probably dropped out of art school prior to graduation, right...would you expect him to know much about economics or business models? Why would anyone even ask his opinion?

     

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    Chuck Norris' Enemy (deceased), Feb 27th, 2009 @ 11:19am

    Value

    they also announced an impressive boxset that cost quite a bit
    Yeah, the designers of the boxed set won a Grammy.
    Impressive

     

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  13.  
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    Anonymous Coward, Feb 27th, 2009 @ 11:21am

    Re:

    Well...maybe for professionals that's the case. But for me and my band, the value of the music is measured in the happiness that it brings us and those who listen to it. We've never sold any of our music (although some people do pay us for our cds) and seldom get paid more than beer and food when we play live. We're not pros and have regular jobs to make ends meet, obviously.

     

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  14.  
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    SteveD, Feb 27th, 2009 @ 11:24am

    'Godlike Genius'?

    ....really?

    Christ; this is why no one reads NME any more.

     

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  15.  
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    Anonymous Coward, Feb 27th, 2009 @ 11:29am

    Re:

    "What I find interesting is how many musicians fail to recognize the promotional value of their own music."

    Because they see themselves as manufacturing a product to sell and not as artists with performences to sell.

     

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    Ima Fish, Feb 27th, 2009 @ 11:34am

    Re:

    "Why would anyone even ask his opinion?"

    That's probably the most insightful comment I've ever read from an Anonymous Coward.

     

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  17.  
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    Rick, Feb 27th, 2009 @ 11:38am

    Customers decide the price every day...

    I just realized, we do this every day. How often d you decide the value of the service from a waitress or water? You tip them for the quality of THEIR service, the quality of THEIR work.
    YOU decide the value, not them.
    Yes, some people are cheapskates, but often it's deserved when no tip is left, or the proverbial penny in the glass tip. It inspires them to work harder and to continue to provide good service.
    This model has been around for as long as I know - what's wrong with applying it to the music industry too?

     

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  18.  
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    TPBer, Feb 27th, 2009 @ 11:59am

    I their music was free..

    and it is easily acquired on all the sharing sites, I would not DL anyway.

     

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  19.  
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    You never know, Feb 27th, 2009 @ 11:59am

    How about this as a business model. I record something rather rude, price it way over what it would be worth just because I'm greedy, than publish it. If someone is crazy enough to but it then try to push the price up and criticize everyone else just because I think I'm “Just to cool...”

    My vote is for Radiohead…

     

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  20.  
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    Yakko Warner, Feb 27th, 2009 @ 12:03pm

    Re: Customers decide the price every day...

    More to the point, isn't "value created by the consumer" the whole concept behind a free market economy? Consumers decide if the value of the product is worth the price by deciding to spend it or not?

    Radiohead's experiment is just one where they let the consumer dictate the price they're willing to pay (on an individual basis, no less), based on the value they perceive exists — rather than the traditional way of having the producer "guess" the value, put a price tag on it, and hope most of the consumers agree that the price is "worth it". (Worth what? The value they, the consumer, assign to the product.)

    An "idiot plan," indeed...

     

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  21.  
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    another mike, Feb 27th, 2009 @ 12:24pm

    Jedi MBA

    "These are not the piles of cash you're looking for.
    "Go about your business.
    "Move along, move along."

     

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  22.  
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    Anonymous Coward, Feb 27th, 2009 @ 12:30pm

    Isn't the "name your price" model the same business model as a street performer? Only your "street" is the internet?

     

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  23.  
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    Ima Fish, Feb 27th, 2009 @ 12:47pm

    God, I'm gay.

     

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  24.  
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    God, Feb 27th, 2009 @ 12:59pm

    Re:

    I forgive you. Just don't let it happen again.

     

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  25.  
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    James Keegan, Feb 27th, 2009 @ 1:12pm

    Survival

    The Radiohead business model works because they have established a large audience that respects them and considers their talents to be of some value. While signed to a record deal, an artist doesn't see a huge return on record sales until you have returned your loan to produce and promote the record. Then you have to sell quite a few CDs/downloads to ad up to anything. There are many entities that take a share. If you are also the writer then good for you. Radiohead has a large enough following to make a significant amount of money in ticket sales and merchandise.

    If a new artist has no ties to large scale promotion, who do they "give" their music to? Unless there is capital to afford a tour (and you are good) then online give-aways are viable because there is nothing to lose. At this point, you are buying promotion with your work. There is a value to the "free" CD.

    Somewhere in the middle is most of the artists. You have to eat and pay the bills. Free doesn't pay the bills.

    Without the investment capital, the artist in the middle can't make the sacrifice necessary to promote their product with give-aways. Money must be generated to survive. Now if there is some kind of momentum, there are possibilities and the artists should investigate them thoroughly.

    Where ever you stand, the art must have some kind of value that can ultimately be generated into money or you need to have a second job paying the bills. I work for a band called Spock's Beard. If anyone has any ideas how to turn a profit without an investment. I'm all ears.

    Jimmy

     

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  26.  
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    PaulT (profile), Feb 27th, 2009 @ 1:34pm

    Re: Survival

    You might want to read the hundreds of other articles on this site about the same issue, with countless examples of artists who have already answered your "questions" by their own actions. These include "no-name" artists who have had no major label career nor any mainstream recongition, yet make a good living.

    "I work for a band called Spock's Beard."

    Interestingly, I have heard this band's name on a b-movie review site I often frequent (www.agonybooth.com, if you're interested, Spock's Beard sometimes comes up on the Amazon links there).

    I'm not sure if I would like the music (it's been described as prog rock, a genre that's very hit and miss IMHO). The site is also run by someone older than myself who often makes comments on music that I disagree with.

    Describe to me why I should spend money on anything by this band without first getting something for free, be it a sample of the music or something else. So far, I have is a trite comment on the band's name, itself borrowing from someone else's work. I am not willing to spend money until I can have some idea that I'll like the band's music.

    "If anyone has any ideas how to turn a profit without an investment. I'm all ears."

    Start by realising that, by itself, the free music is an investment. Just come up with a business model that doesn't depend on selling shiny discs and concentrate on how you can convince people to listen to the band, then spend money on everything else they have to offer (assuming they're good enough for people to want this of course).

    In the meantime, I'll keep myself content with the bands I do currently spend my money on, many of whom I came to discover via their free giveaways.

     

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  27.  
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    Ima Fish, Feb 27th, 2009 @ 1:34pm

    Re: Re:

    Hey God, can you do me a favor and track down the person pretending to be me?! Thanks. (Actually, I'm quite impressed that someone took the time to impersonate me. As they say, "Imitation is the sincerest form of flattery."

     

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  28.  
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    RomeoSidVicious (profile), Feb 27th, 2009 @ 1:35pm

    Man this is disappointing on one level and on another not so much. I have been a fan of The Cure for a very long time and to see Smith speak out of ignorance like this is very disappointing. However I learned long ago, by watching Hollywood, that the stars usually talk out of their asses on most issues. This is no different. He didn't look into anything just popped off a gut reaction. It's not even shocking to be completely honest. It's sad to be sure but it is to be expected of the stars. They listen to their lawyers and friends and don't actually know much of anything.

     

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  29.  
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    Lawrence D'Oliveiro, Feb 27th, 2009 @ 1:37pm

    Masnick's Law

    James Keegan spouted:

    You have to eat and pay the bills. Free doesn't pay the bills.

    You’re new here, aren’t you?

     

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  30.  
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    interval, Feb 27th, 2009 @ 1:38pm

    Re:

    @Ima le Fish: "God, I'm gay."

    He already knew. We all did. I think you were the only one who didn't.

     

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    Ima Fish, Feb 27th, 2009 @ 1:48pm

    Re: Re:

    "We all did"

    Well, I didn't know. But it certainly explains a lot.

     

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    ehrichweiss, Feb 27th, 2009 @ 1:51pm

    Re: Almost finished

    HA!!

    I keep getting a flashback to some skit that MTV and Robert Smith did where it was a 1-900 number and you could call and talk to Robert...went like this...

    "Hi, I'm Robert Smith and I'm soooooooo depresssssed"

    I guess now it'd be "Hi, I'm Robert Smith and I'm sooooo depressssed about giving my useless music away for free"

     

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    Tom, Feb 27th, 2009 @ 1:59pm

    Works Elsewhere...

    I've seen plenty of street performers make quite a bit of money using a 'give it away and pray' system....

     

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    JEDIDIAH, Feb 27th, 2009 @ 2:27pm

    Re:

    Any good band generally has someone minding the store.
    One or more of the members are very aware of the business
    side of things and keeping some sort of eye on it. While
    you can delegate to a certain degree, you still need to
    be able to audit things yourself and call the shots.

    At the "executive level", the band should be in charge.
    Otherwise, they will just be taken advantage of by the label.

    In the end, the band is probably closer to their customers
    than A&R men. In that respect, they are probably a better
    judge of "business".

     

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    SteveD, Feb 27th, 2009 @ 2:54pm

    Re: RomeoSidVicious

    Don't think too much of it, mate.

    It's almost a generational thing; same story with Gene Simmons. These ageing rockers see the world they made their millions from changing, and they're struggling to understand it.

     

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    Weird Harold, Feb 27th, 2009 @ 3:07pm

    Actually Radioheads stuff didn't work

    Radiohead's "name your price" thing didn't really work, the vast majority of users didn't pay for the music, supported by a small minority that massively overpaid for it. It was such a small success that Radiohead ended up pushing the album into a retail distribution deal, where most of the sales have occurred.

    "free" models are a joke, requiring that a small number of suckers pay for everyone else's free ride. The suckers are waking up, and all those free2.0 business models are going to bust.

     

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  37.  
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    Rekrul, Feb 27th, 2009 @ 3:17pm

    I've said it before and I'll say it again;

    Don't just give the music away and hope people pay, charge a small fee for DRM free songs.

    Give people the option not to pay for something and many will do just that. Tell them they have to pay, but make the price low enough that nobody minds paying it and people will pay it.

    People already download music for free from other sources, so they really don't need the band itself to supply it to them. Not only that, it wastes the band's bandwidth.

    Instead, put up a notice that says "If you wish to download our music for free, please check the various file sharing networks. If you wish to support us, you can purchase high-quality, DRM free tracks here for $0.xx each. Thank you for your support."

     

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  38.  
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    Mike (profile), Feb 27th, 2009 @ 5:27pm

    Re: Actually Radioheads stuff didn't work

    Radiohead's "name your price" thing didn't really work, the vast majority of users didn't pay for the music

    This is simply not true. It worked great. They never expected everyone to pay for it. The whole plan was based on the idea that many people wouldn't pay.

    Just because not everyone pays for your content doesn't make the model a failure.

    In terms of overall money made, it was a huge success, greatly outstripping their earlier efforts.

    It was such a small success that Radiohead ended up pushing the album into a retail distribution deal, where most of the sales have occurred.

    Also false. They had announced they would do retail distribution at the same time they announced the name your own price thing. It had nothing to do with it being a "failure."

    "free" models are a joke, requiring that a small number of suckers pay for everyone else's free ride. The suckers are waking up, and all those free2.0 business models are going to bust.

    You might want to learn a little economics.

     

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  39.  
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    Anonymous Coward, Feb 28th, 2009 @ 12:47am

    The Cure, Added to the long list of RIAA supporters and enemies of world of music. I HAD 2 of their CDs, I say HAD cause I threw them away never to be heard again, will turn them off on the radio, The Cure is DEAd now! Good job boys, or should I say Children.

    doh !

     

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  40.  
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    PaulT (profile), Feb 28th, 2009 @ 4:58am

    Re: Actually Radioheads stuff didn't work

    "Radiohead's "name your price" thing didn't really work, the vast majority of users didn't pay for the music"

    Yet, many did. Radiohead themselves have claimed that they made more money from "In Rainbows" than they did from "Hail To The Thief", their last major label album. IIRC, they also sold more CD copies of the album *after* the free copy had been available for months.

    In addition, you miss one of the major points often raised here. EVERY ALBUM is available for free. Whether the band allow it or not, a "pirate" copy will be available. Yet idiots like yourself insist on attacking those who point this out and suggest using this fact to their advantage rather than suing the same people who buy and promote their albums. Pathetic.

     

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  41.  
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    Weird Harold, Feb 28th, 2009 @ 7:52am

    Re: Re: Actually Radioheads stuff didn't work

    Mike, this was the first step out the door. The vast majority of the people didn't pay this time, and as people become more aware of everyone else taking it for free, they too will take it for free.

    You can charge 1000 people $1 each , or charge 1 person $1000 and give it away for free. In the end, someone has to pay for it, and it turns into a game of pin the tail on the fool to find the person willing to massively overpay for the product to make it viable.

    Free music isn't any more free than free credit report dot com - it's just the cost is shifted somewhere else.

     

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  42.  
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    Weird Harold, Feb 28th, 2009 @ 7:57am

    Re: Re: Actually Radioheads stuff didn't work

    Hail to the Theif was a terrible album, spawned no singles, didn't have heavy label support, and under performed every album Radio head had made to that point (especially beyond the initial buy point where the diehard fans buy anything).

    In Rainbows is a decent album with plenty of radio friendly material and a huge media push from this whole name your price thing. The CD sales are a more direct result of the long term exposure on radio, and a clear indication that the only people buying (or downloading) the album online were existing fans and netnerds looking for the latest web20 trend. If they had satisfied all their fans with the name your price option, there would be no CD sales.

    In the end, their were still massively dependant on making actual CDs, signing a distribution deal, getting radio airplay, doing promotions, and all those other things in order to sell the record - all the things they said they wouldn't do. Name your price was just a marketing game, no different from how Paris Hilton lands in the media all the time. I guess nobody was going to be interested in a Thom Yorke upskirt pic ;)

     

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  43.  
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    Zigwalrus, Feb 28th, 2009 @ 8:12am

    This "business model" requires a BIG radio hit before implementing

    Radiohead can pull something like this off because they had 1 BIG radio hit off of their first album. The proverbial foot in the door. In their case they have the stuff to back it up so, 7 records later, after constantly redefining themselves and proving that they're in it for the music, we, their following, will pay whatever because they're brand name has already been made synonymous with greatness.
    There are a million free songs and albums on the internet.
    We care about Radiohead's music because we know about them.
    I suspect a lot of this is due in large part to the constant airplay of Creep on radio.
    My point is whatever the model, you still need heavy promotion, the sorts of like the mass media provides, in order to pull something like that off.
    I am not aware of an unknown band that has given their music away on the net and as a result can play Madison Square Garden.
    Getting the name Radiohead out there was initially done through the old model.
    Personally, I believe the answer lies in a combination of both the indie model and the corporate model. The indie model has the right ideas, mobility, and budgets.
    The corporate model(ideally) has the means.
    As always with most human endeavors, the corporate model has grown rancid. The indie model runs the same risk.
    The two sides are very aware on each others shortcommings. Maybe they should start looking at what does work or used to work in both models and come to a functional medium. But that would take humility, common sense and reason from the both sides.
    Are those up for a free download yet anywhere?

     

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    Mike (profile), Feb 28th, 2009 @ 10:03am

    Re: This "business model" requires a BIG radio hit before implementing

    Radiohead can pull something like this off because they had 1 BIG radio hit off of their first album.

    Then, um, how do you explain all the other bands who have done it successfully as well without 1 big radio hit?

    I am not aware of an unknown band that has given their music away on the net and as a result can play Madison Square Garden.

    That's not exactly a reasonable standard is it? Playing MSG is not the definition of success. But many bands have become successful thanks to giving their music away for free.

     

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  45.  
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    Mike (profile), Feb 28th, 2009 @ 10:09am

    Re: Re: Re: Actually Radioheads stuff didn't work

    Mike, this was the first step out the door. The vast majority of the people didn't pay this time, and as people become more aware of everyone else taking it for free, they too will take it for free.

    So? If all the music is free there are plenty of other business models to be made. Trent Reznor gave away his last two albums for free and made millions.

    But, of course, some will dismiss that as a big name.

    So then there's Corey Smith. He went from a weekend musician to making $4 million gross last year... giving away his music for free.

    You know, BMW gives away its commercials for free (and has done so for many, many years). Actually, they PAY to give away their commercials. And it hasn't ruined their business, now has it?

     

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  46.  
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    Weird Harold, Feb 28th, 2009 @ 3:09pm

    Re: Re: Re: Re: Actually Radioheads stuff didn't work

    Mike, you miss the point entirely.

    NIN / Reznor is someone with the equipment, the time, and the desire to make money with no intention of making profit. His millions come from touring, and he could tour without any new music for the next 20 years and still make millions. Please consider bands like the Scorpions, REO Speedwagon, and Styx, all who has no real new content and make millions every year. You cannot connect A and B so directly and say that because of A, then B. B happens because of what has built up over years.

    Corey Smith really is the same thing. Releasing his music for free on his website is nice, whatever. But the money isn't made unless he tours extensively (or sells ringtones, albums and songs on Itunes, etc).

    As for BMW, well, this is the proof that you truly don't get it. BMW gives nothing away for free, they are marketing to you (and me). They pay for placement to get exposure. You are mistaking advertising for content. CSI isn't selling me nifty computers or DNA sequencers. I see that you are trying to suggest music as "advertising", but it is a bit of a silly process, let me explain:

    Giving away music to push concert tickets (and other merchandising) is the process of giving away millions of dollars (a couple of dollars per person who would buy the album) and replacing it with 0.1% of the people overpaying for a concert ticket. The price of the concert ticket has to be significantly higher than it would have been otherwise to generate the same level of income. If each record sale netting the artist $1, and each $20 concert ticket nets them $10, 1 million lost sales is 1 million dollars lost, and therefore the 10,000 people attending the concerts would have to regen that type of money to put the artist back in the same financial place. Now concert tickets have to be $120 dollars to make the same income. The actual numbers vary, but 1000-1 ratios of album sales to concert attendance isn't far off the mark.

    It's all how you look at it. Would Corey Smith make the same amount of money charging $0.99 for each song and lowering ticket prices by half? Would he have more time to make new music if he didn't have to tour so much to make income? Is potential lost?

     

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

  47.  
    identicon
    Weird Harold, Feb 28th, 2009 @ 3:12pm

    Re: Re: This "business model" requires a BIG radio hit before implementing

    Are there any more successful bands (as a number, ratio, whatever) today than 20 years ago, or are we still sitting with the same number of "successful" acts? I don't see significantly more bands in my town, I don't heard significantly more new music on the radio, I don't read about significantly more new bands / artists than I did before.

    The only thing I am seeing more of is one hit wonders, and I see the same thing on stupid videos posted on youtube. It doesn't mean there is more success, just more transient junk.

     

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

  48.  
    identicon
    Anonymous Coward, Feb 28th, 2009 @ 5:27pm

    Re: Re:

    I respectfully disagree. While the band should always make sure someone isn't ripping them off, there's is no need for them to be marketeers or business modelers.

    If one of the band members does have a knack for business ideas, that's great, but I believe that is the exception rather than the rule. How many great artists do you know who are also great business thinkers? I can't think of any off the top of my head.

    Even for a regional band - see Sirsy (www.sirsy.com) for example - to do everything DIY style: writing and performing, recording, designing merch, selling merch, maintaining website/myspace/facebook/email/etc, constantly on the phone/email booking shows, being on tour, playing every night...etc...etc...it's like 2-3 full time jobs for each member.

    Now it's expected that everyone doing this is going to come up with their own business models too?

    I think that's quite a stretch.

    Does this mean that I think no one should come up with new, potentially successful business models for artists? Nope, not at all. I just think that expecting these folks who are already struggling to survive to be great business thinkers is unrealistic.

    More music and music-related products are being consumed than ever - if smart business people can't figure out a way to make money off of it, that's pretty pathetic. That's why I am so disappointed with the *AA organizations and music labels and all those people whose job it is to come up with these models are so unwilling to do so...stop whining and start thinking!!!

     

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  49.  
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    Mike (profile), Mar 1st, 2009 @ 11:46am

    Re: Re: Re: Re: Re: Actually Radioheads stuff didn't work

    NIN / Reznor is someone with the equipment, the time, and the desire to make money with no intention of making profit. His millions come from touring

    Actually, no. We pointed out how he made nearly $2 million in a single week based on *selling* his new album, which he gave away for free. So, once again, you are wrong.

    Corey Smith really is the same thing. Releasing his music for free on his website is nice, whatever. But the money isn't made unless he tours extensively (or sells ringtones, albums and songs on Itunes, etc).

    Yes. You are proving my point. I'm not sure why you think you're not. He's making a lot more money touring *BECAUSE* he's giving the music away for free. That's just a good business model.

    As for BMW, well, this is the proof that you truly don't get it. BMW gives nothing away for free, they are marketing to you (and me).

    Yes. Just as the music that Reznor, Smith and others give away are marketing to you and me.

    You are mistaking advertising for content

    There is no difference. Content and advertising are the same thing: http://www.techdirt.com/articles/20080318/004136567.shtml

    Giving away music to push concert tickets (and other merchandising) is the process of giving away millions of dollars (a couple of dollars per person who would buy the album) and replacing it with 0.1% of the people overpaying for a concert ticket.

    Oh, I get it. Some dude named "Weird Harold" gets to decide the market price on every product in the world, rather than the market. Thus, while the world is perfectly happy with the prices it gets, Weird Harold decides who is overcharging and who is undercharging.

    Of course, the reality is the exact opposite. Weird Harold doesn't know what he's talking about and the market is quite happy with the other way around. And for all your talk of the millions "given away" and the tiny % of people overpaying, why is it (oh please tell us why) the folks who have followed this model have repeatedly pointed out that they are making A LOT MORE MONEY than they did under the old model.

    So you have fans who are a lot happier -- they get more music at a better price, and have lots of options to interact with the band. And you have the musicians who are a lot happier, because they're making more money and have a better relationship with their fans.

    The only person unhappy is Weird Harold who has trouble realizing that economics doesn't work on the "because Weird Harold said so" model.

    If each record sale netting the artist $1, and each $20 concert ticket nets them $10, 1 million lost sales is 1 million dollars lost, and therefore the 10,000 people attending the concerts would have to regen that type of money to put the artist back in the same financial place. Now concert tickets have to be $120 dollars to make the same income. The actual numbers vary, but 1000-1 ratios of album sales to concert attendance isn't far off the mark.

    This conveniently ignores what has actually happened (why, oh why, must Weird Harold ignore reality? we'll probably never know...).

    In reality, the free music increases the size of your audience significantly. It depends on the type and quality of the music, but the economic models I've seen suggest that it increases your base of core (fanatical) fans by a factor of 3x and then increases mid-level fans by a factor of 5x and increases occassional fans by a factor of about 10x. So, at that point, you can sell out more shows more often, even offering tiered ticket pricing, and you can do quite well.

    And, despite your claims, it's not just about concert sales. In fact, most of the examples we discuss have little to do with concerts. Reznor made his millions not from concerts, but from additional benefits, including exclusive signed books by him. Jill Sobule made tons not through concerts, but by offering interesting packages to get access to her and support her music.

    So there are many, many models that allow the artist to make much more money and still give the music away for free.

    It's all how you look at it. Would Corey Smith make the same amount of money charging $0.99 for each song and lowering ticket prices by half?

    Apparently you missed the part where he tried that. He stopped giving away music for free, and the number of people buying his albums DECLINED as did the number of people attending his concerts.

    Whoops... Empirical proof (again) that Weird Harold is so wrong it's not even funny.

     

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  50.  
    icon
    Mike (profile), Mar 1st, 2009 @ 11:48am

    Re: Re: Re: This "business model" requires a BIG radio hit before implementing

    Are there any more successful bands (as a number, ratio, whatever) today than 20 years ago, or are we still sitting with the same number of "successful" acts? I don't see significantly more bands in my town, I don't heard significantly more new music on the radio, I don't read about significantly more new bands / artists than I did before.

    The only thing I am seeing more of is one hit wonders, and I see the same thing on stupid videos posted on youtube. It doesn't mean there is more success, just more transient junk.


    Your mistake (well, one of many it seems) is to judge "success" on the number of bands you happen to hear on the radio. I judge it by the number of bands who are making money from their music, and that number is vastly higher than it was 20 years ago.

     

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

  51.  
    identicon
    mobiGeek, Mar 1st, 2009 @ 5:33pm

    Re: Survival

    How much money do you expect to make from the sale of CDs under your current approach to business?

    If you aren't known, why would anyone buy your CD? Without access to your music, I'd not drop money.

    So then you are selling CDs at live performances? Only to the fans who decide, for whatever reason, to show up to the bar?

    No one knows you if you aren't getting your message out. In the past, the record labels took care of that angle (read: payola) but even that is/was a business wrought with problems. The "label" approach forces musicians to focus on producing hits, rather than good music.

    Going with the natural flow of digital goods (that they are free to copy), you leverage that free distribution as your marketing angle. If your music is good, you sell other resources because people want to be associated with you. For example, more people show up to concerts and/or buy paraphanalia and/or hire you to do work for them (performances, ads, soundtracks to movies/tv/games/radio/etc...).

    Don't confuse value with price. Something being free doesn't make it less valuable. Companies spend BIG BUCKS to give away their advertising for free. They make that money back through the scarce resources those companies provide.

     

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  52.  
    identicon
    Eldakka, Mar 5th, 2009 @ 4:58pm

    Re: Re: Re:

    I don't know, maybe they should hire a business manager for a wage, rather than a record company for arse rapeing?

     

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

  53.  
    identicon
    Eldakka, Mar 5th, 2009 @ 5:04pm

    Re: Re: Re: Re:

    Let me rephrase that ;)

    Maybe a band should hire a business manager for a wage/commission who's responsibility is to look after the interests of the band (since the band gets all the money then pays the wage/commission), rather than a record label who pays the band and who's responsibility is to the record label (i.e. the record company gets all the money, and hands an amount they see fit over to the band).

     

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

  54.  
    identicon
    Eldakka, Mar 5th, 2009 @ 5:22pm

    Re: Survival

    Somewhere in the middle is most of the artists. You have to eat and pay the bills. Free doesn't pay the bills.

    Being an artist doesn't give you an inherent right to be able to earn enough money as an artist to live on. Do what anyone else (well, it seems anyone who isn't an artist anyway) does, and get a new/second/third job.

    Why is it that people who work full time at art are "artists", and must be able to earn a living doing that?

    Two-thirds the people here at work are artists in my opinion. Well if you discount the BS artists, lets say 1/3rd ;). Many of them go to art classes, some play in pub bands 2 or 3 times a month for fun. Some go home and paint. Perhaps you should follow their example and work a job that 'pays the bills' until you can make enough money working solely as an artist? Rather than trying it arse abouts and working first at a job (being an artist) that doesn't pay the bills. If you are a good enough artist, and have a good enough business model, then oneday you will be able to live off the art. But then, if you are living off the art, is it really art anymore?

     

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


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