A record price for a Radiohead album: $0 (LA Times) - Distribution Control is Toast

Just yesterday I released my new book The End of Control online, for free. Incidentally, Radiohead went out with their latest record, yesterday, as well (admittedly, their music is probably more popular than my books;), for 'any price you want to pay' as a download, and for a very steep price for the box set. The LAT has a good feature on this.

I have talked about this many times before and the Radiohead development is another great example of what's happening right here right now:

• Distribution as a control factor is toast.  Everyone has distribution via the web now. Man have even unvoluntary distribution :)
• Major artists going direct is becoming a fact of life, in the music industry. It's the MANAGERS that are the un-doing of the major record system (along with technology, of course)
• It's ATTENTION that matters first, and only then it is sales. Exposure comes before the selling.
• The Web is the NEXT RADIO and that's where the music is playing, first and foremost
• Give the USER the control, and they'll reward you handsomely.

The fact that this is happening just as EMI and UMG are going DRM-free and WMG's EBJ is furiously back-paddeling from his past 'we will not relent' pitches, should raise a huge warning signal for the major labels: you are about to become squashed between 100s of managers and artists that want to go direct, large retailers like amazon that re-write the rules of online music selling (think bundles... think flat-rate), telcos and operators that are getting fed up with the tedious and outmoded licensing practices, and search engines that are powering or becoming music communities and the next generation of Radio.  If you keep up the strategy of 'you need us badly and therefore we make the rules' you will lose the artists, their managers... and the audience. Another 12 months for this Radiohead experiment to become the default approach. Get engaged or get outmoded. And do it soon.

Update: Chris Anderson has a good blog post on this, here

Nice summary, too:  Some information wants to be free, some wants to be really expensive.

Comments

[Stephen M. Rapp]

What will become of old libraries of music and film? Will the current hold on those works continue in the old system?

[Gerd Leonhard]

I think all libraries of film, TV, and music, will be made available very soon, since it is always better to be present in the networks and reach various points of monetization, then to be hiding behind walls of premium access. See the latest NYT changes.

[jp kaneshida]

With all of the bluster about the way "new media" is changing the info landscape, the real challenges to the old guard seem to be - surprise surprise - in music. Witness Radiohead's latest distribution play. Go ahead - Google it - there's tons of stuff, from major mass media to pundits like Gerd Leonhard or Chris Anderson.

As someone who exists on the margins of this, pontificating till I was sick of it to so-called indie filmmakers, it's all quite amusing. Many of the principles remain the same between music and film and indeed with any artistic medium on the indie level.

But music has a different dimension than most others, and that's concerts. For musicians, this is where the money is. This is why the Stones, who by now are probably mainlining Geritol, are still touring and indeed in their recently completed world tour set a new gross record of over half a billion. That's a ton of Geritol.

So while all of the talk about the "innovation" of Radiohead's distrib strategy is bringing this discussion to more public light, they key thing to get is that recorded music (herein, "records" or, "a record") in the new age of new media is, in the purest marketing sense, collateral. Think of it this way: If a company takes out an ad for its latest widget, its sales expectation on the ad is based upon market research, and the price for the ad is a marketing cost. The difference is split between the two models, stone age and new media. What the mass media congloms of the stone age fail to understand is the stone age media's aside but a new media bedrock: the model of records = marketing cost in the age of new media; they are stuck in the stone age where, first and foremost, records were a revenue generator, instead of a cost center, ie: marketing cost.

In its most basic light, the stone age media's failure is in their out-moded, out-entrepreneured thinking, their perspective, the way they look at, perceive and understand the world. It's the Peter Principle all over again. (from the citation: This is "The Generalized Peter Principle." It was observed by Dr. William R. Corcoran in his work on Corrective Action Programs at nuclear power plants. He observed it applied to hardware, e.g., vacuum cleaners as aspirators, and administrative devices such as the "Safety Evaluations" used for managing change. There is much temptation to use what has worked before, even when it may exceed its effective scope. Dr. Peter observed this about humans. [emphasis mine])

And not to cast aspersions, but new media has its long list of wacko tries - witness the dot-com boom, but that's not un-expected. However, when a would-be king such as Yahoo goes and hires an old stone age patriarch like Terry Semel, (from the largest stone-age conglom on earth! No doubt the Yahoo-ers thought that was a great selling point, but in reality, their thinking as well was stone-age) it more than raised eyebrows with me. (Although I have no eyebrows to brag of) My expectation at that point was for Semel to not get it, and sure enough, in a re-tread of John Sculley at Apple, (Yes, even the mythic Steve Jobs had to re-tool his thinking. Remember his now legendary pitch to Sculley at the time? You want to sell sugar water or change the world?) Yahoo has "failed" spectacularly. I say this in light of the fact that Yahoo could have been the kings - they were positioned to be so, but then their lack of innovation killed their chances, and in a confluence of now history, Google out-entrepreneured them.