Summary From comScore:

While the band, its fans and artists alike are celebrating what looks like a success for Radiohead's bold move in releasing their new album using the ‘pay what you'd like’ model, I think everybody has overlooked one very important aspect of this, and it doesn't bode well for the future of the music industry,” says Michael Laskow, CEO of TAXI, the world's leading independent A&R (Artist and Repertoire) company. “Radiohead has been bankrolled by their former label for the last 15 years. They've built a fan base in the millions with their label, and now they're able to cash in on that fan base with none of the income or profit going to the label this time around. That's great for the band and for fans who paid less than they would under the old school model. But at some point in the not too distant future, the music industry will run out of artists who have had major label support in helping them build a huge fan base. The question is: how will new artists be able to use this model in the future if they haven't built a fan base in the millions in the years leading up to the release of their album under the pay what you'd like model?”

“The high percentage of users actually paying more than a few dollars for this download is actually pretty impressive,” said Jim Larrison, general manager of corporate development at Adify, a provider of online ad network services. “I expected the vast majority of users to download the album for free or at most a few dollars. With 40 percent of consumers willing to pony up real money, this is a true win for the music industry as it shows there is still perceived value in the digital form of entertainment. Of course it does suggest that the marketplace is continuing to migrate and the music industry needs to shift with consumer behavior. There are numerous methods to monetize the music, via shows and concerts, merchandising and box sets, commercial licensing, and even advertising; which is where the industry needs to progress towards, as the 40 percent paying for music might not be sustainable.”

“It is important to note that Radiohead has single-handedly accomplished a milestone that the recording industry has failed to achieve – they’ve eliminated much of the profit attrition related to piracy or illegal copying,” said Edward Hunter, comScore analyst and part-time songwriter. “Moreover, they have garnered good faith with the music consumer at a time when it’s all the rage to bash the industry and the artists who ally themselves with it. And then you have the reduction in cost of sale, cost of promotion and production. I’d call this a resounding success for Radiohead and music fans everywhere – and a fantastic artistic effort as well.”

[reply to jessica]

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1. mara 236 days 2 hours ago [permalink]    

Well said but I am way too lazy to read all that

[reply to mara]

That so awesome. They are my new favorite band. I've always liked their music but the fact that they challenged the music industry, brought a new delivery service, and still were able to make more money then they would if they went the traditional route makes them awesome.

I hope more people follow in their footsteps.

[reply to cozgotti]

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1. jaydog 239 days 8 hours 5 minutes ago [permalink]    

Yeah, with any luck other bands will see how well it did and follow suit. Of course at the other end of the spectrum you've got Prince trying to sue his fan sites for using his image. I guess Prince is the yang to Radioheads Yin.

[reply to jaydog]




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1. mara 239 days 7 hours 55 minutes ago [permalink]    

Trent Reznor of Nine Inch Nails is going to do a similar thing. I guess its easy to take a chance when your rich.

[reply to mara]