The initial reaction to Radiohead’s pay-what-you-want experiment as a future business model hasn’t been good, especially after last week’s comScore study that found about 62 percent of the people who downloaded the band’s “In Rainbows” album chose to pay nothing.
However, a closer look at the numbers shows that those ready to call it a failure, especially major label execs, may be engaging in a bit of wishful thinking.
According to comScore, about 1.2 million people visited the band’s site in October and a “significant percentage” downloaded the album. Of the 38 percent of fans around the world who paid for the album, the average contribution was $4.64. Now that may not be much compared to the $18.99 charged at the mall record store, but all that money went directly to Radiohead – no split with a record company, no manufacturing or packaging costs, and only a tiny fraction of distribution costs that went toward creating and maintaining the website.
That also doesn’t count the profit made on the small percentage of fans also purchased the $82 Discbox version of the album, which includes the album and additional music on CD and vinyl, along with digital photos, artwork and other packaging. It doesn’t include the number of new fans the band may have reached by giving the album away and how that will affect their ticket sales on future tours. And it doesn’t count the amount of good well and increased name recognition it received from all the publicity and those following in their footsteps, including singer-songwriter Saul Williams and even Paste magazine for a time.
“I think it’s fair to say that this model, if executed effectively, can be a very legitimate sales driver,” wrote comScore analyst Andrew Lipsman, who added that conservative estimates put Radiohead’s take at $1 million in October.
PHOTO: Jonny Greenwood / Radiohead