Why pay nothing when you could download illegally?

screenshot / barrio dude Screenshot of the In Rainbows website 

Radiohead made a bold move earlier this month. Free from any contracts with record labels, the British band offered its new album, In Rainbows, for download at whatever price listeners thought reasonable, from nothing to hundreds of dollars. It reportedly reached 1.2 million downloads at the end of the first day, though the band’s manager has called that number exaggerated.

In Rainbows is also available, illegally, on pretty much every major BitTorrent site around the world. As of this writing, there have been 87,253 downloads of one of the 25 versions of the torrents available at Mininova.org, which itself is just one of hundreds of torrent-tracking sites found online. Overall, the first week saw 500,000 illegal downloads.

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The last Radiohead album I really enjoyed was OK Computer, but I still paid $9 to download In Rainbows out of a sense of novelty and, well, admiration. It’s $9 more than I had to pay, but, and I’m listening to album right now, it feels worth it. That makes me slightly above average – $1 to be exact – though significantly less impressive than the fans shelling out $1,000 to support the project. I don’t admire the idea that much.

But why would people pay anything for an album they could get for free? The New York Times explains it’s economically irrational, but it makes people feel good about themselves. It’s a “warm glow” effect, and my personal justifications are described to a T. The real question, though, is why would anyone download the torrent instead of the legal file?

On the day of the release, the website’s server was overwhelmed with listeners and the downloads slowed to a crawl. The torrent sites, on the other hand, only had to serve up a tiny file that users would then distribute over a faster, more scalable peer-to-peer network.

photo / irina slutsky Bram Cohen, creator of BitTorrent technology, tours Austin during SXSW Interactive 2005 

Likewise, people have settled into their BitTorrenting ways. One click, a launch of the torrent program, and you’ve got your album. Radiohead asked for an array of user data, sent an email with a confirmation code, and only then allowed fans to get the album. All told it took about five minutes. But time is money, and five minutes is more than free.

Another explanation is that torrents have made us a generation of data packrats. My hard drive is clogged with music, movies, and photos that I have no intention of ever listening to or looking at again, but damned if I’m going to delete anything. It’s pure instinct to grab that shiny new bit of information and hoard it away. If that’s the case, it’s not about the actual content. It’s just about getting possession of the content as quickly and painlessly as possible. Victory for the torrent.

Many pundits looked at Radiohead’s move as a blow to pirates. The band announced the album’s download plan only ten days before its release to prevent any leaks, but the music is available on ThePirateBay.org regardless. If anything, Radiohead might have given some pirates a little oomph in the moral justification department. If the album’s free, then you can’t really steal it – can you?

I still like that warm glow, though. And I’m willing to wait out the technological problems for a moral victory. But it looks like there’s actual success too. Radiohead’s site jumped 260 places on the global music website charts to seventh position with an 11-fold increase according to Hitwise. Oasis and Jamiroquai, while hardly at the same level as Radiohead, are looking to follow the same business model.

Radiohead is also offering a box set full of physical goodies to be delivered after the digital download for $80. But the real gain – and $9.6 million in record sales still sounds appealing to me – comes in the publicity for Radiohead’s upcoming tour. Not only does the band have a wealth of information about its fans for when it comes time to advertising, it has a wealth of fans.

In his 1993 essay on digital content, Selling wine without bottles, John Perry Barlow, cofounder of the Electronic Frontier Foundation, argued that “familiarity has more value than scarcity. […] Regarding my own soft product, rock and roll songs, there is no question that the band I write them for, the Grateful Dead, has increased its popularity enormously by giving them away. […] True, I don’t get any royalties on the millions of copies of my songs that have been extracted from concerts, but I see no reason to complain. The fact is, no one but the Grateful Dead can perform a Grateful Dead song, so if you want the experience and not its thin projection, you have to buy a ticket from us. In other words, our intellectual property protection derives from our being the only real-time source of it.”

I’m a much bigger fan of the Grateful Dead than I’ve ever been of Radiohead. I like their music, and the Dead were decades ahead of their time – and Radiohead. The Dead didn’t try to stop pirates; they encouraged them. They realized that copyright was good for the published composition of the music, but there’s no real way to pin down performance. There was no need, or way, to make money off the transaction of capturing the concert audio onto a tape.

It’s telling, then, that years down the line, Radiohead has a copyright deal for In Rainbows with its publisher exactly along those lines, protecting the composition, but not the production. But Radiohead is still clinging to the old model. It’s letting listeners choose their price for the album, but the transaction is still a sale.

In 2006 Radiohead played sold-out shows, selling tickets at about $40 a piece. In Rainbows is already better reviewed than 2003’s Hail to the Thief and has so far outsold it. Now it just remains to be seen if that actually pays off. If not, maybe the next album won’t be released on Radiohead’s website. It’ll just go straight to BitTorrent.

“It’s up to you” screenshot from the In Rainbows website courtesy of Nancy


Anonymous's picture

Interestingly, Phish was another great example of this new business model, where allowing for free trading and taping of live performance creates a grassroots word-of-mouth effect, and ultimately expands a band’s popularity one hundred fold. A few years back they were one of the top financially grossing acts in the country (according to Entertainment Weekly and Rolling Stone) despite habitually low album sales, and listed as one of the twenty wealthiest rock bands you wouldn’t think had so much money.

One thing is obvious, as pointed out superbly in the article above: By relying on live performance and merchandise sales (at the show) rather than record sales for funding, bands maintain complete creative control of their art, while also holding on to the majority of profits, rather than foregoing them to record companies and distributers, who take a loss on nine out of ten albums, then cover those losses with the one successful album. As annoying as jam bands can be, they did and still do contribute lots of capital to the business model transition that is beginning to take hold across the industry.

Without straying back to Phish too much, they were also the first (or among the first) band(s) to begin marketing sound board quality downloads of their live performances directly from their own website. My understanding is that this is still extremely profitable for them, even multiple years after they broke up and stopped touring. Granted, live performance has always been part of their appeal, just like the Grateful Dead.
It really makes you think about most of our business models in America— When did we decide that corporations etc. deserve more of the fruits of our labors than we do? Without sounding too much like a communist, when do we get to toss the agents and lawyers and corporate executives into the fire and simply begin to respect artists (of all mediums) for the amazing things they contribute to human understanding and our sense of emotional intelligence? You don’t need a mega-conglomerate corporation to tell you what great art is— you just need to listen and think and consider the world around you. We give artists our money for their art because it moves us, because we enjoy it; I don’t see where a middle man fits into the artist-to-fan equation. It sounds like they don’t anymore…

AJ's picture

I disagree. But only because I hate Phish.