Tuesday, October 02, 2007

Radiohead to pwn the Record Companies!

Imagine you live in 1890 and you drive a horse and buggy. Because your horse needs water and food, there are stables set up along roads where one can stop and give the animals a rest. Since everyone rides horses in 1880, everyone pays these stables a set price for this service; a "horse tax" of sorts.

Now imagine you buy your first car ten years later. Your car runs on gasoline, not hay. Do you want to pay the horse tax anymore? Of course not! What if you were legally bound to do so? You would probably consider the law to be unjust.

That is, essentially, what the recording industry has done. If the internet had always existed, record companies would never have come into being in the first place. In 1980, consumers needed a way to transfer music from the studio to their homes - a record company was the much needed middleman. Now, a band could upload their music to the internet. Most people have a CD burners or MP3 players. Essentially, technology has made it so the record companies no longer need to exist.

Of course, the record companies weren't happy about that. So they use the legal system and copyright laws to force their continued unnecessary existence. They continue to charge insane amounts of money for a CD; sometimes $20.00 (several years ago, the major American companies were busted for trying to artificially jack up CD prices). Only a tiny fraction even goes to the artist. Consumers were left with a dilemma: be extorted by shady media operations, or short their favorite artists.

I chose the latter. Artists can still make money from live event proceeds, and some have websites where one can donate directly. Still, I have been waiting for the day that a big name artist stepped up to the plate and told the record companies where they can shove a contract. I've been waiting for a big name artist to sell their next album directly on the internet. That day has arrived.

Read here. Radiohead (incidentally, one of my favorite bands) is selling their newest CD online. Not only that, but they are going to let us pay any amount we wish. Seriously, one could pay two cents for their album. Essentially it will be like tipping the band, and the money will go straight to them. Personally, I'll be tipping the band five dollars, because I think that is a fair price for an album. That five dollars will go directly to the band. Going through a big record company would have left the artist with maybe a 50 cent royalty on a $15.00 album.

I hope this is immensely successful for Radiohead, financially speaking. It will encourage other artists to follow suit. At that point, record companies will have to choose between going out of business or lowing their prices to fair levels (which, IMO is about five dollars). As an unnecessary middleman, their days of extorting consumers are over.

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