Band’s business model worth a look

first_imgThe unanswered question is will these customers buy what they can legally get for free? Can music be saved by the honor system? Radiohead doesn’t need the money – it is one of the world’s most established bands – and is certainly sacrificing the financial benefits of a major record deal to see if it can help change a broken business model and, presumably, help other bands. We doubt the revenue will reach what a major label push could do for the record, but we like the experiment, and we like bold moves in business, particularly when they come from unexpected places.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! Imagine that you are in an industry that provides great content. You are accustomed to growing revenue, good margins and a fun work environment. You can charge relatively high prices because your customers keep returning, and those who don’t because of age or death are replaced by eager newbies. Not only do you have a history of entertaining your loyal customers, but you are known for leading social change. No, we’re not talking about newspapers. We’re talking about the music business, which has been taking knocks from the Internet, just like newspapers, but in a worse way because newspapers can glean revenue from the Web by selling ads (but not as much as print used to provide) while online pirates take copyrighted material outright. Compact disc sales are down nearly 20 percent over last year. Legal downloading of music is catching on with Apple’s iTunes and other online services, but plenty of fans still steal tracks and then make illegal copies for their friends. Art rock band Radiohead is attempting to change the way the music business functions by allowing its fans to decide how much its songs are worth. The British band plans to sell its new album, “In Rainbows,” only through its own Web site,, at first. (Store sales are to follow next year.) That is not a revolutionary idea, but this is: Radiohead, one of the world’s most respected acts, is asking its fans to pay whatever they think their album is worth. “It’s up to you,” according to the Web site. That means fans can pay the U.S. equivalent of 2 cents or $13 (the Web site charges by the British pound), whatever they want, to support the effort when it is released Oct. 10. Though Radiohead appeals to fans of all ages, its core as 1990s superstars is the educated Generation X crowd that can pay for an album. last_img read more