360° Deals: an Industry Reaction to the Devaluation of Recorded Music
360° DEALS: AN INDUSTRY REACTION TO THE DEVALUATION OF RECORDED MUSIC SARA KARUBIAN* I. INTRODUCTION In October of 2007, Radiohead released In Rainbows without a record label. The band’s contract with record company EMI had been fulfilled in 2003, and Radiohead did not bother finding a new deal as they began recording their seventh album.1 Radiohead then made the album available at www.inrainbows.com, where fans were instructed to “pay-what-you- want” for the digital download.2 Shortly after the album’s release, the band’s front man, Thom Yorke, said “I like the people at our record company, but the time is at hand when you have to ask why anyone needs one. And, yes, it probably would give us some perverse pleasure to say ‘F___ you’ to this decaying business model.”3 It was no surprise that Radiohead received critical acclaim for the artistic merits of the album,4 or that millions of fans found a way to acquire the music. Its financial success, however, was less predictable. Radiohead declined to release statistics related to its pay-what-you-want model, but a conservative estimate suggests that the band’s profits from this digital release exceeded six and a half million.5 Furthermore, when Radiohead contracted with iTunes and a distributor to sell the album on iTunes and in stores, its high sales pushed it to the top of traditional album charts6 in early * J.D. Candidate, University of Southern California Law School, 2009; B.A. University of California Berkeley, 2006. A special thank you to Gary Stiffelman, Professor Jonathan Barnett, and Professor Lance Grode.
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