Radiohead is Not Stupid

Nor is Radiohead giving up all their precious profits in order to make a point.

Radiohead is a BIG band.  That means that they might, if the have a sweet, sweet contract going, actually occasionally make something, a penny maybe, on all those $20 CDs the recording companies sell for them.  For everybody else, who’s not a megastar, you lose money on CDs.

That’s right:  An object that gets produced for about a buck and sold for \$20 is making, typically, a negative profit for the musicians that wrote and performed the music.

(Now you see why the recording companies want you to have to buy a new CD every time you lose one, and not be allowed to loan them to your friends or give them away, don’t you?  Because that CD is pure profit…if you’re in the executive’s chair.)

CDs, my musician pals tell me, are advertising.  Oftentimes they cost rather than make you money, but you do them anyway because they get your name out there.  (Well, insofar as the recording industry lets it get out there, anyway.)

Now.  Radiohead, following the lead of some minor and a few other major acts, are going to be selling their latest album online, in digital form, for "whatever you want to pay for it".  They’re crazy!  say the pundits and wags.  You can’t do that hippy commie bullshit and expect to survive in this world!!!"

Well, look at the facts:  A digital record costs almost nothing to distribute (just the cost of bandwidth and web design, really).  Many people will just snag a copy for free.  But some people will pay for it — maybe up to \$5, because hey, compared to what it would cost even through iTunes, five bucks is a deal.

Basically, Radiohead "did the math" and figured out that, no matter how little their fans pay them for the music, they’re still making out better than they were under a recording contract.  AND THAT’S SAYING SOMETHING, isn’t it?  I mean, how many business deals can you look at and go, "If I stood on the corner and gave this away and asked people to please give me money if they wanted to, no matter how many people did, I’d still be doing better than I am now"?

In other words, in this case, the hippy commie bull is a better deal than the predatory capitalist monopoly.  Let’s all just pause a moment and wallow in our shock, shall we?

…

You know…It’s not very often that you get to look forward to pleasures that last for decades…but during the course of my life, I’m going to thoroughly enjoy watching the recording industry sink like a fat white Titanic.  That they are, and will, is the biggest affirmation of my faith in the free market that I can point to. 

::happy sigh::

PD