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Monday, March 02, 2009

Does The "Pay-What-You-Want" Paradigm Work?


Robert Smith of The Cure recently had choice words regarding the "Radiohead" model of user-determined value of media. Just to remind you, Radiohead released an album in 2007, "In Rainbows," that was available for a theoretically "free" download; it was up to the user's discretion how much money they would pay/donate for the music. It was estimated that 62 percent of users downloaded "In Rainbows" without paying one cent, something Radiohead denied. Nevertheless, after three months the band abruptly ended the experiment, returning to a more traditional sales model.


Smith has said that he "disagreed violently" with Radiohead for allowing the fans to only pay as much as they wanted for "In Rainbows."

"You can't allow other people to put a price on what you do, otherwise you don't consider what you do to have any value at all and that's nonsense.

If I put a value on my music and no one's prepared to pay that, then more fool me, but the idea that the value is created by the consumer is an idiot plan, it can't work."

Reaction to Smith's words on the website Stereogum was largely negative, accusing the singer of being out-of-touch, greedy, and irrelevant. Smith then issued this statement, entitled "Free Music For All," on his official site:

"SO IT SEEMS A FEW PROFESSIONAL APOLOGISTS (YOU HAVE TOLOVE THEM!) OUT THERE DISAGREE WITH MY "EVERY ARTIST SHOULD VALUE THEIRART" MUSING

AND THINK ITS OK FOR ART - MUSIC IN PARTICULAR - TO BEMADE AVAILABLE FREE FOR ALL...

NO I AM NOT CONFUSING 'ARTISTIC VALUE' WITH'COMMERCIAL VALUE'

MERELY QUESTIONING THE DUMB ACCEPTANCE OF THE 'FREEART IS THE 'NEW' PARADIGM - THATS JUST THE WAY IT IS' MANTRA

IN THE WAY OF OUR BRIGHT AND BRAVE NEW WIRED WORLD

THESE IDIOT CRITICS HAVE TRIED VERY HARD TO TURN MYGENERAL POINT - A POINT I MADE USING RADIOHEAD'S 'IN RAINBOWS: PAY WHAT YOUWANT' MARKETING RUSE AS IT IS THE MOST WIDELY KNOWN EXAMPLE - INTO A MOCK SHOCKHORROR "HOW DARE ANYONE QUESTION THE FAMOUSLY INDEPENDENT ANDANTI-CAPITALIST RADIOHEAD, THEY SELL MORE 'PRODUCT' THAN THE CURE SO THEIRSTRATEGY OBVIOUSLY 'WORKED' (HUH?!!)... AND ANYWAY, ROBERT SMITH IS WAY TOO OLDTO COMMENT ON CONTEMPORARY CULTURE" MOMENT...

MY POINT IS NEITHER PARTICULARLY NEW NOR ORIGINAL

NOR EXCLUSIVELY ABOUT RADIOHEADS 'IN RAINBOWS'

BUT IT IS I FEEL STILL COMPELLING

ANY FAMOUS ARTIST WITH A HUGE AND DEVOTED FAN BASE(OFTEN ARRIVED AT WITH A LITTLE HELP FROM A WEALTHY AND POWERFUL 'PATRON' ORTWO?) CAN AFFORD TO DO WHAT HE, SHE OR IT WANTS...

INCLUDING GIVING THEIR ART AWAY AS SOME KIND OF 'LOSSLEADER' TO HELP 'BUILD THE BRAND'

ALL WELL AND GOOD...

HOWEVER

IF THIS 'ART FOR FREE' IDEA BECOMES THE CULTURAL NORM

THEN HOW DO ARTISTS EARN THEIR LIVING?"

What do you think? Do you think the "pay-what-you-want" model works for music? And obviously, the next question is -- would it work for comic books as a whole?

Posted by Verge at 7:30 AM
Labels: ,

31 comments:

  1. Ryan8:38 AM

    I think Robert Smith types like Ozzy Osbourne talks.

    ReplyDelete
  2. John8:49 AM

    It must be hard to be a millionaire musician and have to grapple with the reality that your work has been overvalued over the years and you live a life based on disproportionate earnings.

    How does an musical artist make money in this situation? I've interview dozens of musicians up and down the success scale and they all have ways of making an income beyond album sales. Live shows obviously, merchandise, subscriptions, and paid for projects - such as creating scores for other venues - are all ways that they survive.

    Robert Smith has never her the converse of his logic - the market sets the price of what your work is worth. Anyone who has dealt with comic book back issues understands that, but people in the music industry seldom do. The eventual money transaction for a creative work on a private level is a compromise between what the market will allow and what you value your product at, taking into account work time.

    Unfortunately what musicians have been discovering is that the market has been propped up beyond realistic proportions for years now. Being a musician may be a $30,000 a year job. Being a musician may be something you do because you like it despite the income.

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  3. Verge8:59 AM

    "I think Robert Smith types like Ozzy Osbourne talks."

    I was actually going to take a crack at retyping it all in cap/lower-case, but then I thought: life's too short

    ReplyDelete
  4. Jim Shelley9:16 AM

    I can safely say after three years of making free digital comics that there are *many* great reasons to serve up free content, but anyone hoping to pay their bills with a *pay what you want* business model has sadly

    overestimated the capricious benevolence of the iWeb Republic. :)

    ReplyDelete
  5. Adam Jones9:35 AM

    Since I work in the music industry I can sort of see where Robert Smith is coming from. When a commodity is undervalued commercially then it's utility is also undervalued. The problem in music right is a general disconnect with the audience. It takes a hugely successful band like Radiohead to even be able to experiment with the "Pay for Play", but even so, the stats show that over 70% of the In Rainbows owners downloaded an unlicensed version of it. So clearly, "free" will always dominate over even one cent, no matter how well respected and artistic an artist may be.

    It's also easy to label Robert Smith a greedy old millionaire, but I feel it requires the more successful artists to draw attention to this, both for their own self interests and of those less successful then them. At the end of the day the downloading of unlicensed tracks does not really affect The Cure, but it will prevent management from investing in unproven acts. For some reason once a band is on a major there's a perception by the public that it instantly becomes coke parties and Lamborghinis. It's an industry/art form that thrives for a cool image, and is now a victim of that image. However, the public still wants their rock stars to be "rock stars" despite not wanting to do what they need to to support them.

    Of course, typing like a pissed off teenage girl on Myspace doesn't do much to make his point valid to naysayers (but does sort of fall in line with his music/image).

    As for comics? The pay for play model could work just because advertising is a far more viable option in it. Oh God, the outrage people would have towards the industry if there was a 30 second jingle on some songs. True, it's distracting from the art form (where as visual mediums can get away with it far more subtly), but it just annoys me how music is supposed to be the one art form that is undeserving of financial success.

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  6. Ian Aleksander Adams9:37 AM

    I don't think it will ever work for a physical product - A CD, album, trade, or photograph. Not really - there needs to be some bottom line that takes into account the relevant expenses of producing the physical work.

    I'd never ask people to pay to look at a JPG of any of my art though - it just doesn't seem right since it doesn't cost me anything to copy it.

    Like a lot of work though, it's still a much different experience viewing it in person (holding a little book, seeing a great print) and people will often pay for that (similarly in music, live shows will probably return to being the basis for most artist's income. Trends already show this. I don't think it's a bad thing, though I'm sure it might not be as nice for bands that don't like to tour.)

    ReplyDelete
  7. Laid Off9:56 AM

    Seth Godin is the promoter who championed the idea of distributing free content to, eventually, make a buck. He called it "permission marketing".

    He had so much faith that he published Unleashing the Ideavirus as a free e-book, saying that, regardless of it being available for free, it would still be a bestseller.

    It was, but its success must be put in context. First off, the book was published in 2000, when the idea of downloading content was not as pervasive as it is today. Secondly, because of the uniqueness of his model at that time, it was almost guaranteed to get press (especially when the author has the connections of a veteran promoter).

    In any case, he saw offering content for free as a means toward an end. As John pointed out very ably, content was to be provided as a promotional tool to support a sale--in the case of musicians, an album given to support the purchase of merchandise or a live performance.

    Many webcomics are supported by the purchase of books or merch. But the webcomics themselves don't make anything.

    ReplyDelete
  8. Paul10:28 AM

    Robert Smith doesn't want to undervalue his efforts, but he's also doesn't like it when it becomes overpriced. He has bumped heads with his record company and Apple about the overpricing of a remix ep that came out last year (unfortunately still writing with a caps lock):

    PLEASE DONT BUY HYPNAGOGIC STATES EP FROM ITUNES FOR £7.99

    IT IS ABSURD!

    TMU HAS MANAGED TO FUCK THIS UP TO ANOTHER LEVEL!

    MY EMAIL TO THEM TODAY IS BELOW
    ITS EASIER THAN WRITING IT OUT AGAIN NICELY...
    (THOSE OFFENDED BY COLOURFUL LANGUAGE LOOK AWAY NOW)

    >

    DEAR...

    I FUCKING DESPAIR
    AGAIN

    HYPNAGOGIC STATES EP IS NOW UP ON UK ITUNES...

    5 TRACKS FOR £7.99?
    FOR FUCKS SAKE!

    AND THE PACKAGE IS COMPLETEY MISSING THE EXTRA BONUS TRACK (65DOS ALT REMIX OF "THE ONLY ONE")

    SO
    YOU CAN BUY THE FOUR REMIXES BY 30STM/AFI/MCR/FOB INDIVIDUALLY FOR 79P EACH...

    BUT YOU ONLY GET THE 65DOS "EXPLODING HEAD SYNDROME" REMIX OF ALL FOUR SINGLES IF YOU PAY £7.99 FOR "THE ALBUM"...

    IE YOU ARE BEING ASKED TO PAY £4.83 FOR THE 65DOS REMIX... !!!
    WHO THE FUCK IS GOING TO PAY THIS AND NOT FEEL TOTALLY RIPPED OFF?

    IT'S NOT A FUCKING ALBUM!
    IT'S A 5 TRACK EP
    AND YOU ARE SUPPOSED TO GET AN EXTRA FREE TRACK (THE 65DOS REMIX OF "THE ONLY ONE") IF YOU BUY IT AS A 5 TRACK EP
    AND ITS SUPPOSED TO COST LESS IF YOU BUY IT AS A 5 TRACK EP THAN IF YOU BUY THE 5 TRACKS INDIVIDUALLY...

    THAT IS WHAT WAS AGREED



    THIS IS SO TOTALLY WRONG
    I REALLY DO FUCKING DESPAIR

    WHY IS IT SO INCREDIBLY DIFFICULT TO GET ANYTHING DONE RIGHT?



    PLEASE FIX THIS NOW

    >

    I AM POSTING THIS AS I FEEL



    UPSET!

    ANYWAY
    PLEASE ONLY BUY THIS 5 TRACK EP FROM ITUNES WHEN IT IS AVAILABLE FOR AROUND £4.00 OR LESS AND YOU GET THE FREE 65DOS T.O.O REMIX - IT'S FAB AND THE MONEY (WELL - OUR SHARE OF IT!) IS GOING TO A GOOD CAUSE...

    THIS GOES FOR ANY OTHER ITUNES STORES AROUND THE WORLD

    LIKE JAPAN...

    ONWARDS...
    RSX

    ReplyDelete
  9. mordicai10:37 AM

    I think...Robert Smith should turn off caps lock & use the space bar every so often if he wants to be taken seriously?

    Also, as media distributes, rock stars will die. I am okay with this. There won't be rock stars, there will be actual professional musicians. I am okay with this. The same goes for other set-ups.

    ReplyDelete
  10. Verge10:50 AM

    The one (only) thing I like about the all-caps is the authenticity of it all. Sometimes when I read these statements and posts on official sites, I have my doubts if they are "real" or just written by a publicist.

    There is no doubt in my mind that these posts are written by Smith.

    ReplyDelete
  11. Torsten Adair11:19 AM

    (Pardon the duplicate post...)

    Well, I read this blog for free (aside from the cost of the computer and electricity).

    Does this blog help you publicize yourself, and help you find work?

    Everyone, go read Cory Doctorow's "Content". It's free online at:
    http://manybooks.net/titles/doctorowother08content.html

    There are ways to make money from free content. There are ways to make more money by charging for content. The Laffer Curve seems to be predominant paradigm.

    The classical paradigm for comicstrips is: Newspaper pays syndicate or distributor to run strip based on territory and circulation. Newspaper sells newspaper via subscriptions and single issue sales, using the comicstrip as a "feature" to encourage sales and develop reader loyalty. ("Gotta see if Daisy Mae catches Li'l Abner!") Using circulation figures, newspaper set advertising rates.

    Currently, there are two non-newspaper websites which feature comicstrips: comics.com and gocomics.com . Both are free (gocomics charges for extra features), and are supported by merchandise sales (Cafe Press, trade collections) and advertising. Regular readers are likely to be fans, and this creates a choir to which can be preached.

    In other words, it's a blog where the main content is comicstrips.

    ReplyDelete
  12. Ryan12:01 PM

    I generally love it when Kanye loses his mind and rages in all caps online. But Robert somehow types with a garbled English accent.

    He should find a way to sell that instead of letting me enjoy it for free.

    ReplyDelete
  13. JMY12:35 PM

    "Also, as media distributes, rock stars will die. I am okay with this. There won't be rock stars, there will be actual professional musicians. I am okay with this. The same goes for other set-ups."

    Oh, to be so young and naive.

    ReplyDelete
  14. Laid Off2:27 PM

    @Ian Aleksander Adams

    The issue is that, in moving from the selling of tangible things to the selling of electronic bits, perceptions used to be different. But I think that's changed a great deal.

    Professional photographers regularly will offer packages where you can buy the jpg of the photo. Once they've done the shoot for you, they post them online so that you or your family and friends can buy them directly.

    Movement from tangible goods to intellectual property is what we're talking about. People regularly buy software online, now. But they aren't buying anything that's different from when they were buying a jewel case with a disk in it. It's just the method of delivery that's changed.

    But the problem I have is when the price is the same, regardless of the distribution method. It costs manufacturers (whether it's music labels, photographers or whatever) considerably more to create a tangible piece and put it in a package for consumption than to host a server for people to download. The latter does involve a cost (one that's often devalued by consumers), but it's FAR LESS than the other model.

    If I'm doing a print run of 300,000 comic books and getting them distributed into retail outlets, it costs a bundle. The margin is pretty small, and they might be returnable, which means I may have wasted stock that will come back to me at the end of the quarter or the year to be tossed. But if I put it online, there's no waste. I don't have to worry about fulfillment issues (except to make sure my server's up and running) or if I have to go into 2nd or 3rd printings. I always have the right amount of stock and my revenue comes to me directly without worry of returns.

    But, as has been said, if I'm still trying to charge $4 apiece, what's the consumers incentive? You haven't met me, the buyer, half-way to try to overcome my perceptions of ownership.

    That's the issue I have with iTunes. They charge anywhere from $10 to $15 for an "album", which is often the same price as you'd pay in the store. It's silly, since the cost to them is much lower.

    Have the same issue with Amazon and the Kindle.

    ReplyDelete
  15. Anonymous2:44 PM

    Giving your (X) away for free is charity. There is nothing wrong with charity. HOWEVER...

    If people see some new (Y) is giving their (X) away for free...some new, unproven (Y), people are less likely to place any perceived value on the (X), and thus, won't bother examining it for actual value. We are hardwired to equate monetary value with actual value.

    Now, when you decide to use your (X) as a promotional item instead of promotional items that would help sell (X), you can chalk it up to advertising expenses. However, you are reducing the value of (X) in people's minds. No one values a commercial OVEr the product, unless it's a Jack in the Box commercial.

    That's just my two-cents, i.e. next-to-valueless opinion. And you got it for free!

    ReplyDelete
  16. Hysan6:13 PM

    I guess I can't get past how much Robert Smith looks like the Joker.

    ReplyDelete
  17. Ricardo Reyes8:50 PM

    I kind of see what he means, artist like Radiohead can earn more money with experiments like this than via the usual distribution systems, and "pay what you want" can ultimately give you a lot of dough if your fanbase is huge and loyal but at the same time I think what Robert says comes from artistic pride rather than the wish to be zillionaire. Art has got to cost something because something (raw materials, skills, time, etc.) was needed to create it. what Robert might be saying is "art isn't worthless", if Radiohead fans are getting something of value getting the songs but the artist don't get nothing that's wack, whether it might be a penny or a thousand bucks and I'm talking from an artist/audience point of view rather than as a company going "you thieves, pay for the actual record".

    ReplyDelete
  18. Ricardo Reyes11:56 PM

    For example, as a designer myself, the design community is like "don't do work for spec, don't be too cheap 'cause you'll hurt us all since the client will want things cheaper every time, and at the same time it's ok for the consumers to say "music should be free". It's hard to take sides because I kind of understand the "record companies have been abusing us for years" argument but I'd like the artists to have a decent living since they are creating something valuable from me.

    ReplyDelete
  19. skullduggery12:45 AM

    I agree with Robert Smith on this one. If you create something, you should be the one to set the value that you want to make it available for. If someone else doesn't want to pay that, then they don't get it. Simple as that.

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  20. Andre1:02 AM

    Pay what you think its worth will only lead to 5 hours of hard work for $5 in pay. I know this first hand as a kid trying to make a buck.
    Its easy to translate that paradigm into "free but make a donation if you can be bothered but you really don't have to."

    ReplyDelete
  21. mrfables2:04 AM

    I paid Radiohead, my favorite band, 18.00 US$ for In Rainbows during the 'experiment'.

    They deserved my $.

    However, I don't charge for the music I MYSELF produce.

    People give me their e-mail addresses at shows I play, and I mail them a 3 song set.

    Then, if they reply,
    I email them one more,
    with dates of upcoming shows
    at the bottom,
    and so on, and so on.

    I DO charge to see me play
    a show where I play SAID music.

    It just seems right.

    ReplyDelete
  22. Anonymous3:11 AM

    Pay What You Want? No.

    Pay The Correct Amount For The Amount of Content You Get? I'd be down for that.

    ReplyDelete
  23. mordicai12:30 PM

    "Oh, to be so young and naive."

    Oh, to be a patronizing jerk on the internet.

    ReplyDelete
  24. Reddog3:08 PM

    I've never been one to tell people how to price their product. I have friends in the arts as well as my wife who designs women's clothing and accessories and I can see how much time and effort she puts into the design and manufacture of an item but I don't know all the other investments in the piece. But I do think a price hhas to be set by the producer of said product.

    I think if the creator doesn't put some sort of "value" on their product it is naive for the general public to do so. The idea that sometheing is worth what someone is willing to pay for it (usually) works when the producer sets the value.

    Many people don't understand the amount of work it takes to get a finished product out there and I think 60 percent of non payments for Radiohead's album may be low...

    I have always been a fan of Robert Smith and this discussion is just another example why...

    ArrrOOOooo!

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  25. Michael Keener5:04 PM

    This comment has been removed by the author.

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  26. Michael Keener5:15 PM

    This comment has been removed by the author.

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  27. Michael Keener5:17 PM

    This comment has been removed by the author.

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  28. Anonymous11:54 AM

    Whether Smiths numbers on the percentage of people actually paid for "in rainbows" are correct or not seems rather beside the point.

    the question is whether it was a commercial success.

    As for them ending it, and then going to the more traditional model, there's not nearly enough data to actually judge that. The (old, granted) reports linked in the post stated:

    The obvious question now is why would Radiohead kill the promotion and go back to a traditional sales model if the cash were rolling in?

    The album is still in its infancy, say music industry executives. The economic life span of an album can last as long as two years.

    But those are judgements based on old models. Two years on the internet is a hell of a lot different than two years in a store. The internet moves at incredible speed. 3 months on the net is a LONG time.


    Now, if Mr Smith is refering to worth based more on Integrity than Sales, well, he's still wrong.

    Artists don't get to define the worth (any form or worth, be it artistic worth OR monetary worth) or of their own work. Radiohead choosing to let the public decide for themselves the worth of the art that they made doesn't undermine the worth of art at all, because the public has ALWAYS decided on the worth of artworks, and always will.

    ReplyDelete
  29. JMY2:09 PM

    Don't spout half-baked, unsupported utopian theories and I won't be so patronizing.

    The "cult of personality" phenomenon will not go away under any distribution system

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  30. Ian Aleksander Adams9:15 PM

    @laid off

    I was totally thinking more in the lines of fine art print market or commercial work (eaten by stock).

    I think the service side of photography will never die - a professional service will always be desired by those who can afford it.

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  31. Katie Starr12:24 AM

    Robert Smith makes total sense. Those who want something for free, or those with an over-inflated sense of entitlement would disagree, of course. I'm sick of people thinking everything should be given to them for free.

    ReplyDelete

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