More on Radiohead's Experiment

PaidContent.org has what it claims to be a "concrete analysis" of Radiohead's experiment in letting customers set their own prices. In the first 29 days of October, 1.2 million people supposedly visited the site, though that doesn't say how many people downloaded the music. Of the downloading group, 38% chose to pay, and 62% didn't. Average worldwide price paid was $6, and when you factor in the number that didn't pay, the average payment per download was $3.23. Because we don't know how many are downloaded/sold, it's impossible to know how much money the band has made. For some additional details, check PaidContent.org's sister UK site.

What to make of this? My feelings are ambivalent. Of course not everyone would pay, particularly when the band offered to let people choose their own price, and zero was an acceptable offer. But a good chunk did. The average payment was small, and yet it could quickly add up. Imagine an author getting even $2 or $3 a copy. Now, Radiohead is well known, and those who aren't well known will have a more difficult time getting the sales. But that's generally true even with conventional publishing. Even a relatively small number - in the low thousands - could start generating the type of money that would rival at least the lower end of advances of many of the series books (like Dummies, Idiots, Buffoons, Morons, Chowderheads, Politicians). And the up side would be far more attractive.

On the Radiohead and the Booker Prize

There's a bit more information now - of varying quality - on Radiohead's experiment in letting people set their own price for the group's new album. That's important for writers to follow, because many of us will have to find ways of making our own markets and success independent of publishers who keep ratcheting down payments to authors while they still try to get how to make money on the Internet.

According to a Forbes article, many people are still pirating the new Radiohead album, even though they could go to the site and get a legitimate copy for free if they wanted to:

On the first day that Radiohead's latest became available, around 240,000 users downloaded the album from copyright-infringing peer-to-peer BitTorrent sources, according to Big Champagne, a Los-Angeles-based company that tracks illegal downloading on the Internet. Over the following days, the file was downloaded about 100,000 more times each day—adding up to more than 500,000 total illegal downloads.

That's less than the 1.2 million legitimate online sales of the album reported by the British Web site Gigwise.com. But Eric Garland, Big Champagne's chief executive, says illegal file-sharing is likely to overtake legal downloads in the coming weeks, given that many of those 1.2 million legitimate sales were pre-orders taken during the 10 days between when the band announced the album and its actual release last Thursday.

Garland suggests that the real culprit is habit - they go to their favorite BitTorrent sites and download in the way they're used to doing.

However, even with lots of pirating, consider the economics. According to a London Times article (and we'll get to the main part of the article in a minute), an Internet survey of about 3,000 people who bought the Radiohead album suggested that most paid an average of £4. Although this won't be particularly accurate, it's the best numbers possible: a rough total of £4.8 million on the album, all going to the band. Given the economics of regular record deals and distribution, I think they made a whole lot more this way. The real test will be whether they do the same on their next album.

But what does this have to do with the Man Booker Prize? Because it plans to make the novels on its short list available for free online:

The downloads will not impact on sales, it is thought. If readers like a novel tasted on the Internet, they may just be inspired to buy the actual book.

Journalist and science fiction author Cory Doctorow has said for a while, now, that making his books available for free online has increase his actual sales. As I said, this is something that every writer will have to face. Will it be the necessary free part of freelance?

Listen to the Music

The music business seems a far call from writing, but it actually isn't. And that's why you should pay attention to some developments in that industry. After ten years, London group Radiohead walked away from a normal label release of its latest album and sold it over the Internet only for whatever price people wanted to pay. According to the BBC:

BBC Radio 1's head of music, George Ergatoudis, says there is "real pressure" on record labels to keep up with the changing times.

"They need to change how they run their business. The future is definitely more competitive than it has ever been," he says.

The band is currently refusing to say how many orders it has received or how much people are paying, according to Gigwise.com. But the action alone has been enough to start major interest among some musicians in dropping major labels. Nine Inch Nails just dumped its label, according to the London Telegraph, and Madonna - never known for being a business dope - just dumped Warner Music Group to sign a ten-year, $120 million deal with concert promotion company Live Nation.

The Wall Street Journal points out that the deal may be financial stupdity on the part of Live Nation, but forget even that for a moment. The lesson is that no industry is so entrenched that writers, musicians, photographers, and artists are forced into indentured servitude. A way out may be risky, but so is staying in place. Now is the time to experiment - perhaps on the side to start - and see what new business models might be possible, if you want to remain in business in the future.