Reading into Radiohead's Results

There has been what looks like some rigorous analysis of the Radiohead move (which I blogged about here, here, and here) to make their album available online at a pick-your-price, no-DRM format. This comes to us from paidcontent.co.uk.

The results are astonishing. An estimated 1.2M copies of the album were downloaded, with 38% of downloaders chosing to pay, and of those, the average was $6 per copy paid (Americans paid a more generous average of $8).

Back of the envelope math says 1.2M * 38% *$6 = a little under $3M. I have no idea of the distribution arrangement, but lets say they give up 10 points for billing, bandwidth, etc, andanother 10 points to someone to manage all this for them. That still leaves $2.5M.

Now the article linked to above comments about the number of copies circulating via bit torrent, etc, but that's beside the point, isn't it? That'd be happening if they were on iTunes. The real question is how many copies they'd have to sell on $10 - $15 plastic where they are making, say, 10 points. (I have no idea what rev shares are in the music biz, so I'm really blowing smoke here). At that point, they'd have to move 2M copies in order to reach the same level.

That's totally doable, but not *certain*. Their first four albums went platinum in both UK and US, so at least 2M units per album, but their last couple albums were between 500k and 1.5M-ish each.

So in this case, they (a) hit at least the minimum threshold they'd have done via the traditional channels, (b) now have a direct relationship with their customers, and (c) created a marketing vehicle for the album and the band that money couldn't have bought.

Sounds like a win to me!