What would you pay for an album? That's the question being asked by the British band Radiohead.
As you've probably heard by now, Radiohead announced that its forthcoming album will be available for $15, $3.50, or even 7 cents. Basically, it's yours for whatever you choose to pay.
"What a fantastic gimmick."
That was Aram Sinnreich's first reaction to this sales strategy. He's a media professor at New York University and a Radar Research analyst. Sinnreich says in addition to being a clever public relations move, Radiohead's name-your-own-price plan is also a nod to a new way of thinking.
"Consumers setting the pricing really indicates a shift in the balance of power in the music marketplace," says Sinnreich. "Ten years ago, the major labels could actually tell retailers what price points to set within their own stores. Then the Department of Justice said that wasn't right, and you saw retailers begin to offer more flexible pricing in stores. This is a further extension of that process."
"Consumers themselves have become more and more powerful," says Sinnreich. "And this operation simply acknowledges that fact, and allows consumers to say exactly how much the music is worth to them."
Of course, there is the possibility consumers will shell out a shiny nickel, grab the music and hit the road. This is a country where only one in 20 downloads is actually paid for.
"Many, many people are going to download it for free and pay nothing. Many, many other people, probably not quite as many, are going to decide to make a statement and say, 'I support Radiohead and therefore I'm going to pay $20 for the album,'" says Sinnreich.
"The vast majority of people, however, I think are going to come in somewhere in the middle and say, 'I appreciate what they are doing. I realize they need to make money. I want them to keep making music. And I'm going to pay what I think is fair.' Which is probably going to be around $5."
Five bucks is clearly less than the average going rate for a new album these days. But it's important to point out that Radiohead will sell this album, titled "In Rainbows," as a download via its Web site. No record company. No distribution costs. By cutting out the middlemen, Radiohead gets the lion's share of the profits.
Plus, Radiohead isn't exactly a struggling, newbie band. Over the years, it's sold nearly nine million albums in the U.S., and three of its CDs have debuted in the top 10 on the Billboard album charts.
According to Michael Bracy, the policy director of The Future of Music Coalition, Radiohead's just the kind of band that could make this name-your-own-price strategy work.
"There are very few bands who have the type of commercial success and committed fan base and track record that could really pull this kind of thing off," says Bracy.
And, Bracy adds, album sales aren't really where the money is these days anyway.
"Creating an album, in many ways, is a calling card or a way to gain exposure. If you hope to make a living, it's going to be via touring and via licensing your work for use in soundtracks and commercials and things like that," Bracy says. "That physical product is still a revenue stream, but it's a much smaller revenue stream than it used to be."
"So what Radiohead's doing is what any indie band is doing in a lot of ways, which is saying, 'Pay attention. Come get our music. Listen to what we're doing. If you want to pay for it, pay for it. If you don't want to pay for it, don't pay for it. But we're going to be coming on tour and there are other ways for you to participate in what we're doing commercially down the pike.'"
The way Bracy sees it, this move by Radiohead is really a political statement, a comment on the state of today's music industry.
"The political statement may be that the system is broken, and that the layers and layers of bureaucracy and all the different gatekeepers that have been in the middle between musicians and music fans -- that goes away," explains Bracy. "Now that doesn't mean that this is the solution, this sort of voluntary tip jar model where everything's available for free and people pay for it if they want to pay for it. That's not a long-term, systematic solution for the challenges of how artists get paid in the future."
Like Michael Bracy, NYU's Aram Sinnreich doesn't think the Radiohead model will become the new industry standard. But he says it's a turn in the right direction.
"I think it's a stepping stone towards what the digital music future is going to look like," says Sinnreich. "I don't think we've arrived at any final destination yet."