By Stevie Smith Nov 8, 2007, 13:45 GMT
It would appear the recent ‘pay whatever you think it’s worth’ offer tabled by British band Radiohead prior to the download release of its latest studio album "In Rainbows" has revealed that neither album nor band are valued particularly highly by supposed fans or general music lovers alike.
comScore figures suggest that some 60 percent of those downloading Radiohead's new 'pay what you like' studio album are choosing not to pay at all. Credit: Radiohead.
Challenging the music industry’s conventional distribution and sales model, Radiohead has made its new album freely available via an official self-titled Web site, where the consumer is allowed to determine the price point they are willing to pay in return for downloading the band’s new material. However, according to figures released by Internet market research specialist comScore, an online sales study of "In Rainbows" highlights that only around 40 percent of those downloading the band’s new album were actually prepared to pay for it.
comScore’s study, which covers the first 29 days of October, outlines that some 1.2 million people landed on the "In Rainbows" site, with a great many of that number opting to download the new album. Sadly, however, only 38 percent of those global downloaders were willing to offer remuneration, while the remaining 68 percent of the album’s downloaders would perhaps be better described as freeloaders.
"I paid $5 U.S. and had no reluctance whatsoever to take out my card and pay. It’s a fantastic record, the best thing they've done in years," commented well-known music aficionado and managing partner of Union Square Ventures Fred Wilson, regarding In Rainbows. "But, this shows pretty conclusively that the majority of music consumers feel that digital recorded music should be free and is not worth paying for. That’s a large group that can’t be ignored and it’s time to come up with new business models to serve the freeloader market."
Visitors from the U.S. revealed they were willing to spend the most for Radiohead’s new album, offering up around $8.05 USD per download, while international visitors to the site were prepared to invest a mere $4.64 USD. comScore suggests that a higher disposable income in the U.S. could have contributed to the higher payment, while international consumers are much more accustomed to the prevalence and popularity of free file-sharing destinations.
Those payment figures plunge yet further though, after factoring in those downloading the album for nothing, which then pulls the worldwide and U.S. price performance down to $1.68 USD and $3.23 USD respectively. And, of those willing to pay for Radiohead’s album, only a mere 12 percent were prepared to offer between $8-$12 USD (around the price you’d expect to find on music download services).
"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," said Michael Laskow, CEO of TAXI, the world's leading independent A&R company. "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?"
comScore analyst Edward Hunter offers that it is important to remember that Radiohead’s model has "single-handedly accomplished a milestone that the recording industry has failed to achieve" by wiping out "much of the profit attrition related to piracy or illegal copying." Beyond that, Hunter also points out that the band has, notably, managed to strike a positive chord with music consumers in a time when "it’s all the rage to bash the industry and the artists who ally themselves with it."
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