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Radiohead Rocks the Record Industry



I wrote about British rock band Radiohead’s experiment to get rid of their record label and sell direct their music direct. The results are coming in and so far Radiohead has sold 1.2 million albums in just a week. They let their fans determine what to pay. I guess it’s sort of like Priceline for music. They settled on $8 (I can’t seem to find how exactly they arrived at this number) and that has probably made the band about $10 million already. Also amazing is that the number of albums sold in the first week is higher than first-week sales of its three previous albums combined.

As the New York Times reports, Radiohead is navigating some creative deals – including one that will let an indie label license the album for a period of time. Radiohead would retain ownership.

What I find amazing is that the site isn’t that easy to use. No matter, they have a fan base and they’ve shown this model can work. Talk about a revolution…the experiment is working. Others like Madonna and Nine Inch Nails to follow.

UPDATECNET reports that Radiohead says the average price set by consumers is £8, or $16 (not $8 as Mashable reported). However, the actual price paid, again as reported by CNET, looks to be £2.50 for the CD (about $5)—less than Radiohead would have earned per CD sold through their record company (£3 or $6).

  • http://www.looktotheright.com Noah like the Ark

    That is cool…Power to the people. Prosumer Power!

  • http://www.marketingpilgrim.com Andy Beal

    Even at $8 on average, that’s probably 3-4 times what they would have got as their share from a record company.

  • http://www.thevanblog.com Steven Bradley

    I think this is one of the coolest stories out and I wish Radiohead all the success they can get. It probably wasn’t the easiest decision to face the unknown this way and they seem to be pulling it off so far.

    Andy most bands make their money from touring and merchandising. I think even if they made $0 per sale of the CD they could still come out ahead.

  • David

    All is not as it appears.

    The MP3s available through that site were encoded at a very low bit rate, and according to some fans made the music lacking in depth.

    According to Radiohead’s manager this was all a promotion to get people to buy the physical disk when it is released.

    http://www.boingboing.net/2007/10/19/radiohead-downloads.html

    As you pointed out there are other bands cutting out the middle man with direct distribution, but alas it seems that Radiohead may have just been riding a PR wave with a little stunt of their own.

  • http://www.bogaziciperde.com Perde

    It’s actually £8 not $8. Read this on Slashdot also, however nothing is that cheap in UK ;)

  • http://www.gowfb.com/ Furniture Store

    This really rocks!! I hate the idea of a faceless, soulless corporation raking in the big bucks for music made by creative people and bought by consumers. They are the fat cats who just take the cream, raising prices for the ultimate buyer for no value added.

    You rock too Janet Meiners! Cheers!:)

  • http://None None

    “The MP3s available through that site were encoded at a very low bit rate, and according to some fans made the music lacking in depth.”

    They’re encoded at VBR 192kbps which is superb quality, its the standard for mp3 nowadays.