Another Hammer in the Coffin for Record Labels?

On the 10th October, Radiohead will release their new album ‘In Rainbows‘. More interestingly however, the album will be made available as a download from their own website and we, the customer, can decide how much we want to pay for it. If we don’t like it, we don’t have to pay a penny! What’s more, they haven’t signed a deal with any of the major record labels or the major distributors, including iTunes, and there will be no promo’s for the album. They’ll be releasing it and distributing it themselves, and it will be made available to everyone at the same time.

Radiohead are regarded by many as the best band in the world, which is what makes this announcement even more important. According to an A&R Executive at a major label, as quoted in this Time artice – “If the best band in the world doesn’t want a part of us, I’m not sure what’s left for this business … if you can pay whatever you want for music by the best band in the world, why would you pay $13 dollars or $.99 cents for music by somebody less talented? Once you open that door and start giving music away legally, I’m not sure there’s any going back”.

This comes at a time when the record labels and the RIAA (Record Industry Association of America) in particular are facing increasing criticism over their approach to music copyright protection. It wasn’t long ago that it was discovered that SonyBMG was surreptitiously including Rootkit installers in CD’s to enforce copyright protection – when the CD was placed in your computer CDROM drive an hidden installer would install the copyright protection on your PC without you knowing. Once this became public SonyBMG had to quickly backtrack after what become a PR disaster for them.

And just this week, in yet another RIAA lawsuit in America, SonyBMG’s head of litigation, Jennifer Pariser, while testifying before a jury, stated that making a copy of purchased music was tantamount to stealing, even if you’d bought the CD and was simply making a backup. So in the eyes of the record labels, if we download music or buy it on CD and then copy it to our MP3 player, which most people do these days, we are in fact thieves. With an attitude like that it’s no wonder that many people don’t think twice about downloading music illegally.

The truth is , in every area of business, the Internet is introducing new business models that give more power to us, the consumer, and increasingly allows small business’ to take on the big guys. It’s truly democratising the world, well at least those parts of the world that have access to the Internet! If the big corporations don’t recognise this and adapt to it, they’ll quickly lose market share.

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