The Pot of Gold at the end of In Rainbows

I haven’t blogged at all about Radiohead’s new record In Rainbows because plenty of other people have done me the courtesy of exploding all over it. (For the record: no, I don’t think it’s their best work, although yes, I do like it quite a bit. It’s a little easy-listening for my taste, generally. I also don’t understand the allegations that it’s a return to accessibility for them, but I am perhaps not a good judge of music’s accessibility).

Anyway. Now that all that critical reception is out of the way, I want to talk a bit about the article that Drudge has up about it now. You know, the one that’s headlined “Most Fans Paid $0 for Radiohead Album.” (If that isn’t a headline custom-designed for Drudge, I’ve never seen one. If the article were biased in the other direction, the headline would be “Radiohead Pocket 100% of Profits From Album”).

Putting aside the fact that I’ve never heard of the company (comScore) responsible for the press release that was clearly gobbled up and regurgitated by the AP, the story leaves a lot of the critical questions about the album’s release (and its success or failure) unanswered.

For example: It’s pretty difficult to do any real calculations from the numbers in the article to determine a rough idea of how much money Radiohead made from sales of the record (which is the real relevant question underlying this whole discussion, which nevertheless goes unasked here), because the study doesn’t say what portion of the 1.2 million people who visited the website actually purchased it. It also, for what it’s worth, does not provide a margin of error. Other reports have calculated that 1.2 million people actually downloaded the record in the first month; since Radiohead is not talking, it’s at this point impossible to say what proportion of that number is actually correct. (That being said, if you lowball it and estimate that 50% of visitors did in fact download In Rainbows, that means that 600,000 people got the record in the first month, which is about twice as many people as bought Hail to the Thief during its crucial first week). It’s probably also worth mentioning that artist royalties for major label releases are generally acknowledged to hover around $1-2 per unit shifted, although the article does not do so.

An aside: Let’s assume that of the 600,000 assumed downloads, 300,000 of them are to American consumers. Keeping the article’s numbers, if 40% of the American downloaders paid an average of $8.00 for the record, then Radiohead made $960,000 on first-month album sales. Compare this to $450,000 - $600,000 in probable first-week earnings on Hail to the Thief, and then remember that this doesn’t include the $82 discbox that probably moved in decent numbers too, as well as the fact that the band didn’t have to jockey with a label at all. Seems like a great deal for the band to me, even with numbers that I think will probably be proven to be conservative.

The other major flaw with the reasoning in the AP article is that it fails to actually reckon with the nature of the release. Other reports to the contrary, it’s really not fair to think of the digital release of In Rainbows as directly analagous to the retail release of their other records, since the band will (in direct contradiction of the article) release the album on CD on a major label sometime soon. I think that it’s much more accurate to perceive the digital release as a band-sanctioned leak that cannily allowed them to profit from the initial pre-physical-artifact-release downloads that are a real part of how the music business works now. (Another alternate headline: "Most Fans Pay $0 For Albums"). As Radiohead’s spokesman says here, the band is really thinking of this as a promotional stunt - a way of whetting appetites for the retail-purchased object. In my view, Radiohead have essentially acknowledged that digital previewing of recorded music is now the industry standard, at least amongst the tech-savvy consumers who are probably a majority of their fan-base, and made their bid to get in on that action.

This is all conjecture at this point. Since there aren’t any real institutions analagous to or as reliable as Soundscan set up to guage sales of this sort, and since Radiohead is keeping mum (for now), it’s going to continue to be unclear whether this release was a business success in itself. Furthermore, it will not be clear whether the release was a good promotional gambit until the actual compact disc has been in stores for a few weeks. In any case, I doubt that the band much cares - with the album in a safe perch as the second-best-reviewed record of the year and plans for a tour in 2008 (where bands historically make all their profits anyway) underway, I imagine they’re counting their blessings instead of their ducats.