Posts filed under “Digital Media”

Radiohead Adapts Our Business Model

John Paczkowski used to write "Good Morning Silicon Valley" (He’s now at Digital Daily).

Way back when, John created the "Great Recording Industry Business Model Contest:

The recording industry needs your help. It can’t seem to figure out a business model that takes advantage of the way the Internet has changed the economics of music distribution. Perhaps you can. Beginning today, I’ll be accepting submissions for "The Great Recording Industry Business Model Contest." I’ll post the best in GMSV as I receive them and I’ll reward the author of the winning entry with the appropriate plaudits and a SiliconValley.com t-shirt in CEO-prison-scrub orange. Have at it.

The first model I proposed was the Napster Cooption Business Model:

"Napster would have been more like a multi-user programmed FM radio. Ideally, the Napster download medium would be of a lower burn quality (ripped at 128kps), somewhere between AM and FM. Napster traders would only be able to download these modest fidelity versions.

The last aspect involves the conversion of downloaders to buyers. This would be aided in part by giving music fans an additional incentive to purchase an old school, manufactured and shipped polycarbonate disc, or in the alternative, download a higher quality MP3 . . ."

A few years later, we rolled out a variation: The Grokster Cooption Business Model:

Use the technology as a promotional tool. Turn it into a modern, on-demand, web-based radio. Put out low-fi mp3s (96k or so) as way to expose new artists, promote special releases, rarities, etc. whet people’s appetites for more content which history teaches us they are willing to pay for.

Jiu Jitsu the concept of piracy into a terrific tool for the industry to track, more precisely than anything else before, what artists and songs are attracting which listeners, and where. Custom tailor tours around it, marketing and advertising campaigns, etc.

Create the holy grail of algorithms:  Use it to roll out new music, artists and content via our clever algorithm that can tell, based upon what you have already downloaded, what you may like, will like and will definitely fall in love with.

Turn the recording industry from an asteroid doomed dinosaur to a warm blooded furry mammal. Coopt the technology. Embrace people’s love of digital music. Be smarter business people.

Well, it seems that someone was listening: RADIOHEAD:

Radiohead MP3 release a tactic to lift CD sales

Radiohead’s much-debated decision to let fans choose what they pay for its new album online is a promotional tactic to boost sales of compact discs, the band’s management said yesterday.

"If we didn’t believe that when people hear the music they will want to buy the CD, then we wouldn’t do what we are doing," Bryce Edge of Courtyard Management told Music Week, the UK’s industry magazine.

Nice to know someone was paying attention . . .

Sources:

Radiohead MP3 release a tactic to lift CD sales
Andrew Edgecliffe-Johnson
FT, October 11 2007 03:00 | Last updated: October 11 2007 03:00    http://www.ft.com/cms/s/0/0a9c779a-7797-11dc-9de8-0000779fd2ac.html

The Napster Cooption Business Model    http://bigpicture.typepad.com/comments/2003/09/the_napster_coo.html

The Napster Grokster Cooption Business Model    http://bigpicture.typepad.com/comments/2005/06/the_strikeoutna.html

Category: Digital Media, Music

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Category: Digital Media, Music

The Bubble Man

Category: Digital Media, Federal Reserve, Inflation, Psychology

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Category: Digital Media, Music

Blade Runner: The Final Cut at the Ziegfeld

Category: Digital Media, Film, Technology

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Category: Data Analysis, Digital Media, Financial Press, Venture Capital, Web/Tech, Weblogs

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Category: Digital Media, Music

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Category: Corporate Management, Digital Media, Financial Press

Listener Determined Download Prices?

Radiohead

Interesting story about Radiohead’s new release, "In Rainbow’s."

Their pricing scheme for downloads is designed to give the Music Industry — especially major labels — fits. According to their website, IT’S UP TO YOU.

Notes Salon:

"This weekend the band announced that its new album, called "In Rainbows," will
go on sale on Oct. 10. They still haven’t signed with a label, and the album
won’t be available in record stores nor on iTunes or any other online music
shop. You’ll find it only on the band’s site, and if you’re looking for a
digital version, the price is very attractive: Whatever you’d like to pay.

You can pre-order the new album here.
Click to purchase the download and you’re presented with a simple screen at
which you’ve got two boxes to fill in, quantity and price (in pounds). "It’s up
to you," the site says."

For those of you who, like me, prefer the physical media, you have a high priced, rpemium option:

"If you’d like something physical, the band is also selling "In Rainbows" in
something it calls a "discbox," a beautiful package that includes a CD, two
vinyl records, digital files, album artwork, and lyrics booklets. It sells for
40 pounds, about $81 (the price includes shipping anywhere in the world). If
you’ve got a Radiohead superfan in the family — and who among us doesn’t? –
your holiday shopping just got easier."

(Additionally, I see a lot of other Econ bloggers have weighed in on this natural experiment:  Free Exchange, Mankiw Blog, Truth on the Market, Freakonomics, Long Tail & Marginal Revolution . . .)

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Category: Digital Media, Music, Web/Tech

BLADE RUNNER: FINAL CUT NYC Saturday

Category: Digital Media, Film