Billboard.com
11/6

If a product is worth only what people will pay for it, then what is a digital album worth? Not much, according to Internet research group ComScore.

According to a study examining how consumers reacted to Radiohead's "set your own price" gamble with the digital release of the new album "In Rainbows," 38% paid an average of $6. The rest paid nothing.

Of those who did pay, 17% paid less than $4, 6% paid between $4 - $8, 12% paid between $8 - $12 and 4% paid more.

"This shows pretty conclusively that the majority of music consumers feel that digital recorded music should be free and is not worth paying for," said Fred Wilson, managing partner of Union Square Ventures. "It's time to come up with new business models for the freeloader market."

In the 29 days after the album was made available, the Radiohead site received more than 1.2 million visitors, most to download the album, according to ComScore.

The study also broke down U.S. sales vs. the rest of the world, and found U.S. fans are willing to pay more. Of the users who downloaded the album, 40% paid for it from the U.S. vs. 36% of non-U.S. fans.

A Radiohead spokesperson declined comment on the study.
[Edited 11/6/07 17:43pm]
[Edited 11/7/07 9:27am]

so did they make less money than if the album would have leaked?

This kind of saddens me. I paid more than market price, around $18.00, because this is a band that really deserves to be supported. They probably did make more than a leak and I will still buy the actual copy when it comes out or better yet the box set but I would have throught radiohead fans would have ponied up at least a goddamn dollar for it

SupaFunkyOrgangrinderSexy said:

i ponied up a pound. isn't that like thirty american dollars or something?

Anxiety said:

It's at least 2 I paid 8 pounds and it equaled $17 and change.

Well no matter what they paid it was pure profit because no one was involved, no one to pay off, no distibution, nothing at all, it really wasnt a big risk at all, strictly win-win situation. I got it but paid 0 for it, not because i didnt want to pay because i like and respect Radiohead, but mainly because i havent enjoyed their recent work too much, really since Kid A i feel its been a drop in the material, so i was worried about the direction this album would be, and though i like it more than their last few projects, somethings missing.

They could have made a sliding scale of AT LEAST ONE DOLLAR.

It might have made a difference. People just wanted to hear it like a preview.

awwww.....i feel bad..it was a 'smart move' that failed


#2..they shouldnt have let it be available 4 free in the first place
[Edited 11/6/07 21:31pm]

paisleypark4 said:

1.2 million or howevermany got the album via their web site as opposed to via illegal download leakage. that's an artistic success, as most of the fans got the music the way the artist intended. kind of a rarity these days.

and given the method of the offer, i'm sure that even as cheap as most fans were, radiohead wasn't exactly ouching at the end of the day. i think it was more of an experiment/statement than radiohead trying to release their own "crystal ball" project.

Radiohead made some 8 million dollars from the downloads. No promotion costs, no shipping costs, and no cut being taken from a record label.

I'd say Radiohead is doing just fine. If anything this is an attempt to scare more bands away from the doing the same.

PapaSmurf said:

my math says five million..either way, they made a mint.

Well, on the surface, that sounds disappointing! But I guess when the album will be finally available on CD the people, who paid for the download, or the real fans, will buy the CD as well! So the band will have sold the same album twice I don't think some downloaded files substitute for a real CD or vinyl edition of the album!

surprise surprise...the average consumer sees no value in paying for recorded music, even if it is one of their favorite artists and they will spin the album nonstop of the next 18 months...people feel entitled to free music more than ever. this has been going on hardcore since about 2000/2001. i'm shocked.

Copycat said:

That's a damn shame. I didn't get it because I'm not a fan of theirs, but I admired their attempt to circumvent the traditional business model. That most people feel entitled to have the album for free says a lot about how depraved we have become. I'm pretty appalled, frankly.

Copycat said:

My mathematical skills are atrocious but let's assume 1,200,000 copies were downloaded...

If 38% paid an average of $6.00 and the rest paid nothing, well 38% of 1,200,000 people is 456,000... and multiplying that by six dollars totals $2,736,000.

I have no idea how much the file-hosting and bandwith cost them, but I'm fairly sure that they made more money than they would have by selling 1,200,000 copies through a record label.

Is it CD quality? If it is, then they do deserve more. I paid 7 bucks for my copy. I find that the quality is a little poor, but it is still a great CD none the less.

MartyMcFly said:

The majority of CONSUMERS, PERIOD, are cheap bastards. Who doesn't like free stuff?

Its not just a music thing.

If the majority of people are asked what they want to pay for something, they will choose the lowest amount possible.

Nothing wrong with that. Is the seller doesn't agree, don't sell it.

SquirrelMeat said:

agred...i so don't the outrage over this.

NEWS


Radiohead Calls ComScore Report Inaccurate

Link

Nov 9

Radiohead stuck up for its fans on Friday.

The rock band denied that 62 percent of those who downloaded the group's new album paid nothing for the music.

Last month, Radiohead announced that it was releasing a digital version of the album for whatever fans wanted to pay. Internet research group, ComScore, on Monday released a report that said only 38 percent paid anything for In Rainbows.

In a statement, Radiohead's representatives called ComScore's report "wholly inaccurate."

Radiohead's pay-what-you-want offer is groundbreaking and is being watched closely by fans, music labels and other bands. How it fares could influence whether other acts try and sell their own music via the Web--without the support of the labels.

Andrew Lipsman, a ComScore senior analyst, didn't back down. In a blog posted to the company's site on Thursday, Lipsman said that he was "very confident" in the data.

ComScore derived its numbers by watching the Internet behavior of nearly 1,000 people. Several hundred among this group downloaded Radiohead's album.

In the blog, Lipsman said that when it comes to statistics, this is considered a large sample.

"We observed the actual online spending behavior from a robust sample of hundreds of individuals in order to produce an accurate estimate," Lipsman said in his post. "If we didn't have a reasonable sample from which to extrapolate, we wouldn't have released the data."

But in their statement, Radiohead's handlers said that ComScore's study "in no way reflected definitive market intelligence or, indeed, the true success of the project."

Radiohead has declined to reveal any sales figures.

I'll wait until someone whose name is easily recognized in various circles, tries that same experiment before saying yay or nay.

Copycat said:

HAHAHAHHA

Look, this is what I've said on prince.org for months... But people were too concerned to blame nothing but the music industry...

Pff...

Obviously the reason why the CD sales have declined is simply because people don't have to pay anymore...




And all I can say Radiohead should thank their ex Music label that spent millions to make them famous...


[Edited 11/12/07 9:50am]

I applaud Radiohead. Plus the Comscore is reported to be inaccurate. I think we may be missing the point. 1.2 million people reportedly downloaded this in the first day,which means that in today's age where artists make money touring this could be a few more people who will pay $75 for a concert ticket and wideing Radionhead's audience.

Also record companies are just not getting what makes an album sell these days. So why not push the envelope? I think more artists should try something outside the box, what do they have to lose.

Commercials, myspace, anything and everything try it, can't be worse than consecutive declining sales of cd's for the last few years.

I would pay a fair market price for it (if I were a fan...I didn't care). Maybe a little less considering I'm not getting a physical release.

Dannii should do this with her "Club Disco", which is mostly made up of already released tracks! She is charging 7.99 euro...what is that in dollars? Like $12?

I paid 0 for it too - but I plan on buying the CD when it comes out.

Anyone who paid for this got taken.

Radiohead must not support its fans all that much if they're going to have a "pay what you want" and then release the CD in time for Christmas, but not only that, the SAME ALBUM with BONUS TRACKS! What a bunch of assholes!

So if you paid for download, you have to pay AGAIN if you want the ENTIRE album and in good audio quality. Again, what a bunch of assholes.

I could see the point in getting bent out of shape about people paying nothing for the album if they weren't going to release it on CD, but obviously they had planned on doing this from day one.

And you guys wonder why no one wants to pay for music anymore? Not only do we have to worry about getting fucked over by some major label, but now we have to worry about getting fucked by the artists too!?

guitarslinger44 said:

i thought everyone understood an physical copy would be available. no?

Take for example the Smashing Pumpkins new album Zeitgeist. Came out, what - a few months ago? It's already re-released with added songs on it.

Bands bank on the completists; those who have to have EVERYTHING by that band. Both Garbage and Radiohead sell an insane amount of singles that have unreleased songs as "b-sides" for that very reason.

Also, most online "sales experiments" are doomed to fail because the lowest-common-denominator will download whatever they can for free, and will not buy CDs in stores.

guitarslinger44 said:

Surely hearing the album proper (bonus tracks are a BONUS) a number of weeks before it hits shelves is worth something. I disagree.