2008 has started off with a slap to the music industry’s face because of the release of Radiohead’s highly anticiapted album, In Rainbows. This album did not only receive massive amounts of hype because Radiohead had not releases an album in years but also because the method of distribution that they chose: instead of relinquishing their rights to a major label, the members of Radiohead decided that they would distribute their album on their personal site for digital download. But here’s the kicker. Radiohead decided that their album could be purchased for however much the customer thought the album was worth. Many predicted the demise of the band as greedy customers would pay nothing for the album. Though only 40% of the people who downloaded the album actually paid, they made substantially more money than they did if they signed with a major label (via Wired.) They made about $3 million from selling the album alone, averaging about $6 dollars per customer. This may seem like a low number but many people under estimate how much of the profit the labels take for themselves. Radiohead made enough money from their digital sales that they could afford to release their album in physical CD form on the first of January, 2008.
I bought In Rainbows today even though I already had the album in digital form because I loved this album (I think it’s their best so far) and also because this album serves as a critical point in music history where major music labels are being forced to rethink their business plans. Bands and artists are beginning to realize that their rights to their own music are becoming severely limited by signing with an album. One example of this is that most artists do not get to decide their pricing on digital downloads at all or any other aspect of distribution because the labels decide that for them. This is counter-intuitive because the artists should own the rights to their own music that they created but more often than not, that isn’t the case.
I see big changes in 2008 for the music industry, especially since Warner started to sell their artist’s music on Amazon.com, free of DRM. Only a few more major labels are excluding themselves from selling DRM free music (I’m looking at you, SONY BMG!) As more and more customers realize that they do not own the rights to the music they paid for, more and more customers are refusing to buy DRMed music, in spite of the convenience.
So hats off to you, Radiohead, for starting a slow, but steady and much needed revolution in the music industry. Hats off to your great album which I will now listen to for the 100th time, lossless and DRM Free. Music has never sounded sweeter.