Piracy - You can't have your cake and eat it

Another comment on HN[0] said it better, by citing Francis Ford Coppola:

> "We have to be very clever about those things. You have to remember that it’s only a few hundred years, if that much, that artists are working with money. Artists never got money. Artists had a patron, either the leader of the state or the duke of Weimar or somewhere, or the church, the pope. Or they had another job. I have another job. I make films. No one tells me what to do. But I make the money in the wine industry. You work another job and get up at five in the morning and write your script.

> This idea of Metallica or some rock n’ roll singer being rich, that’s not necessarily going to happen anymore. Because, as we enter into a new age, maybe art will be free. Maybe the students are right. They should be able to download music and movies. I’m going to be shot for saying this. But who said art has to cost money? And therefore, who says artists have to make money?

> In the old days, 200 years ago, if you were a composer, the only way you could make money was to travel with the orchestra and be the conductor, because then you’d be paid as a musician. There was no recording. There were no record royalties. So I would say, “Try to disconnect the idea of cinema with the idea of making a living and money.” Because there are ways around it."

[0] http://news.ycombinator.com/item?id=3491678

In retrospect, I have come to partially disagree with my own assessment. I did not account for the fact that Radiohead also released an $81 box set with the digital download, and that 100,000 loyalists bought the set -- earning the band a cool $8.1 million in addition to the revenues they earned from the digital download (believed to be in the ballpark of $3 million). When you factor this in, the band did very well for themselves. Not quite as well as they usually do on big-label albums (even after middle-men's takes). But for an experiment, I would call it a success.

What's fascinating about "In Rainbows" is that roughly 8% of the users accounted for approximately 80% of revenues from the site. That speaks volumes, and it dovetails really well with recent blog posts (linked here and elsewhere) about the new metrics of success in digital distribution: i.e., monetizing loyalists. A small core of loyalists who are willing to follow you to the ends of the earth are worth more than fairweather fans.

I'm actually contemplating doing a more in-depth analysis on this, Louis C.K., Reznor, and others in this space. While I believe the jury is still out, and I believe that most people will pay nothing if offered the opportunity, there are clearly those who will pony up -- and even those who will pony up big. Piracy -- or free acquisition, in this case -- doesn't seem to matter too much if the loyalists are there, and you can differentiate the product for them. (In this case, the notion of a "fair price" actually seems to be relative).

It's interesting how Radiohead seemed to succeed by recognizing this fact, whereas Reznor's experiment failed to account for it. And Louis C.K. avoided the free option altogether, which is another way to go.