This subject keeps resurfacing – most recently in a few blog posts by Mark Mulligan (VP and Research Director at Forrester) and a less recent critique of the Forrester  report “Music Release Windows: The Product Innovation That The Music Business Can’t Do Without“.

Note: Another report came out in late September from Forrester dealing with a similar topic – “Music Product Manifesto: The Product Features That Will Save Recorded Music.“  That’s for a later blog post (or few).

Today, we stick with free!

In my previous post, I covered Imogen Heap’s latest release (Ellipse) and how it’s up to the artist to decide what their own “free” will be.  Is it the music? Is it the experience of getting to see the work behind the scenes? Is it copies of your live concerts? Whatever it is, you need to have a strategy and be clear on how that strategy gets executed day-to-day.

I’ll start at the beginning, with a chart explaining how Forrester’s proposed Music Release Windows schedule would work:

Now, the critique from Michael Masnick at Techdirt (emphasis mine):

But, of course, parts of the plan are a bit of a headscratcher. It still seems very much focused on getting people back into “buying music” rather than coming up with actual scarcities to buy. Instead, it tries to invent new artificial scarcities, mostly by copying an awful idea from the movie industry: windowed releases. The idea is that “premium club” members would pay to get access to music before others, and could get some sort of bundle of content. Two weeks later, the regular “release” would happen, with CDs, download stores and radio. Then, three weeks later, there would be a “free” component that actually is more “feels like free” using either ad-supported downloads or streaming.

Of course, like the movie industry, this ignores both reality and what people want. Those timelines won’t make much sense, because as soon as the music’s out, it’ll be widely available. There’s just no stopping that. Artificially holding it back doesn’t do much good and doesn’t give anyone a reason to buy. If anything, it actively drives people to unauthorized copies. Those who don’t want that “premium club” offering won’t wait six weeks for the official “free” streaming version with ads. They’ll just go out and get an unauthorized copy.

Fair point from Michael, and one I strongly agree with.  I liken this to the practice a lot of smaller (especially electronic) record labels use when selling new tracks digitally and on vinyl.   I’ll list it out step-by-step for those not too familiar with how this works.

1. Release a digital track
2. Press a small number of  numbered Limited Edition vinyl releases
3. See how they both sell
4. If demand continues to be present for the Limited Edition vinyl release, press a larger amount with a different B side, keeping the star track on the A side, preserving the value of the Limited Edition release and fulfilling the demand with product for eager consumers

This works with electronic music as many people still like the physical copies of the records.  Record stores may be a niche business to many, but they’re still a profitable business for people interested in jazz, soul, hip hop and electronic music to name a few.

The process above is also a great example of true scarcity and responding to true demand for a product, which is different than purposefully creating a scarce product in order to try and attach a better profit margin to the product. Same result, but created from two different situations; one is business-led, the other consumer-led.

Mark Mulligan later posted a blog entry defending his stance in the “Music is Free” raging debate.

Here’s the part I take issue with:

One of the counter arguments used by commentators is that having a MySpace page is an ends in itself these days.  No, it is a means to an end, and the VAST majority of artists see it that way.  If an aspiring artist doesn’t get signed to a label / publisher / agent they’ll remain one of those many tens of thousands of artists struggling to stand out from the crowded pack on MySpace.

My question to Mark, or any artist that reads this blog, is WHY does a label / publisher or agent have to be involved in order to make you successful?

What is preventing the independent artist from getting in contact with companies like TuneCore (nice new website design, by the way!)? If the answer is “it’s too much work to be my own label / publisher / agent” then why not use a company like ArtistData to simplify everything? Even the argument of “funding is given by these companies to develop the artists” is rendered pretty null and void if you use Kickstarter (see my recent post about JuaKali’s project on Kickstarter, which I’m happy to report got funding and is being produced!).

Forrester’s points are valid if viewed within the mindset that you HAVE to involve a label, publisher or an agent.  They’re also valid if you view the “main problem” of the music industry as “the inability to stop illegal downloading and file-sharing and the struggle to get consumers to buy music”.

That’s the point, though. The music industry doesn’t require any of those parties or viewpoints expressed above.  Yes, it’s a struggle for many artists to adapt to this new model when they’ve been able to survive so long on the old one.  On the flip side, it’s an event greater opportunity for those very same artists and companies to lead the way with developing the new music business model.

It’s an opportunity to develop a model that works, one that evolves, one that is sustainable and, most importantly – one that satisfies the needs of the businesses, the musicians AND the fans.

It all started with this tweet:

Naturally, I went to investigate. Here’s what I found.

As I dug a bit deeper I discovered that JuaKali was using Kickstarter, “a funding platform for artists, designers, filmmakers, musicians, journalists, inventors, explorers…”

It’s a pretty simple service.

Someone (an artist, designer, etc) creates a project and names the price. From there, they use their network (and Kickstarter’s own “Discover  Projects” area) to solicit pledges. Creators can specify pledge levels and associated rewards; a great incentive tool to get those larger pledges.

If the project reaches the funding level before the deadline the pledges are collected and the project goes ahead as planned. If not, no money is ever taken from the people who pledged for the project and the project disappears.

This has a lot of potential.

1. It’s easily shared. Email the link, put it on your website or your blog, tweet it, include it on your Facebook fan page, or put it on MySpace.
2. It’s low-risk. If the project gathers the necessary amount of pledges before the deadline, the project gets funded. If not, no money is ever taken and the project disappears. No risk for the people pledging, and no risk of the artist ending up with partial funding for a project that requires the full amount.
3. It’s low-fee. Kickstarter takes a 5% fee out for each successful project, but otherwise the service is free.
4. It’s social. Each project lists the supporters, as well as provides space for the artist to update (blog-like updates) and comment on the project. Everyone involved has an identity.

Have you used Kickstarter? I’m interested in your experiences and opinions, so leave a comment!