Trent Reznor on CD prices
I don't know what his contract with Universal's Interscope Records provides, but I suspect that Trent Reznor doesn't hold the copyrights to his band's latest album (Year Zero by Nine Inch Nails). So I'd be surprised if he could legally authorize fans to "steal it," as he instructed attendees at a recent concert in Sydney, Australia. But he does have a certain moral authority on the subject. It is his work, after all. And he has a legitimate beef about the price of CDs Down Under. HMV sells Year Zero for a stunning AU $32.99, which converts to about $28 here. You can blame the lousy exchange rate for part of the sticker shock, but not all of it.
Reznor's eagerness to share the record with fans hasn't been confined to Australia, however. To promote the album, he leaked three tracks as MP3s, fully intending them to be passed around online. At the time he said the freebies were an attempt to boost sales, not crater them. Although his comments in Australia go further, they are in line with his previous remarks about the labels' greed and separation from music fans. In sum, his attitude speaks volumes about the growing problem for labels as established acts join newcomers in craving ears, not dollars, for their CDs.
Granted, it's a lot easier to part with CD revenue when you're capable of filling auditoriums at $75 a head, which is what it cost NIN fans to get into the 3,500 seat Hordern Pavilion. Nevertheless, a business model that trades CD revenues for ticket sales makes an increasing amount of sense even to veteran acts as the slide in CD sales deepens. No wonder Warner Music Group honcho Edgar Bronfman is so keen for "360-degree contracts" that would cut his labels in on tours, merch and other pots of revenue they don't share today. (A tip o' the hat to the Lefsetz Letter for drawing my attention to Reznor's comments, and to Coolfer for Bronfman's.)
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I'm not much of a NIN fan, but $28 is outrageous in Australia. Good for Trent for mocking the ridiculous markup. Production costs have gone down tremendously over the 20 years of CD production but prices have barely dropped. Still I admit, I go to my favorite record shop in Westchester to buy CD's nevertheless.
Posted by: NorthofRight | September 19, 2007 at 06:15 PM
Well, Trent has a valid point about CD prices given the likely "income" of the purchaser. Bronfan makes an even more valid point about tour proceeds not trickling back to the label iin the idea of the "360 revenue." HOWEVER, that is both the labels and the artists unions faults - the contracts are what they are. So, the revenue sharing point amounts to empty whining which does not justify the price of the CD.
How does over-charging the retail price of CD to recoup so-called "lost revenue" justify pricing a CD so high that it will actually harm its sales? That makes no sense whatsoever.
Posted by: more or less | September 20, 2007 at 09:23 AM
I remember back in the 80's when the whole "Home Taping Is Killing Music" thing was going on. Now, there's those saying file sharing is killing music. Actually, it's just forcing the music industry to evolve and modify the way it does business. The biz has become a top-heavy bloated dinosaur anyway, where executives have been taking a lion's share of the profits while the artists continue to toil at what amounts to a low-wage job. It's about time the power gets put back into the artist's hands.
Posted by: Chris | September 20, 2007 at 09:48 AM
I've been saying this for 10 years. I'm an independent solo artist based here in LA and my previous band was signed to a label which I shall absolutely not name. We would walk into stores and see our little baby band's CD on "sale" for 15.99!! How is a kid that we just played for going to consider spending his hard earned cash (or allowance) on something so expensive when he's not even sure if he's going to like it??
CDs should be $10 flat. They are making money hand over fist on the backs of artists and they know it. They're not freaking out over piracy and downloads because it affects the overall money. Artists have almost historically not made that much money in comparison to the companies. They're worried about their own bloated cash flow and their own lifestyles having to change. They simply don't get it. The fact that ol Edgar Bronfman is so callously calling for 360 degree contracts (what a dopey name) is just another indicator as to how embarrasingly desperate and grotesquely non-artist friendly labels have become. It should come as no surprise that these royal arses spend millions of dollars on private jet fare when most artists drive their own vans.
And yet, they worry about profits. Kudos Trent.
Posted by: Chance | September 20, 2007 at 09:55 AM
Trent is right. The music industry, not the bands, are so out of touch with the consumers it's unbelievable. I only buy CDs now because I make enough money to do so. When I was working for minimum wage I was just burning them from my friends. It's become an exclusive business and music, of all things, should be much more accessible to the fans.
Posted by: ChimairaLady | September 20, 2007 at 10:54 AM
it doesn't matter, NIN really blows. Trent is a poser
Posted by: Tommy | September 20, 2007 at 12:26 PM
@Chance: CDs should be $10 flat? I'll give two reasons how that could lead to big problems. First, brick-and-mortar retailers would have less incentive to carry CDs. They'd be forced to give up floor space for more profitable products. The second relates to the first: It is unlikely that sales would increase by an amount that would offset the lower wholesale and retail prices. If retailers and labels could count on an appropriate increase in consumer spending, dropping prices would be a great idea.
Ironically, the New York Times had an article today about artist fan clubs and their ticketing practices. Nine Inch Nails was mentioned as one of the bands that gives is fan club members access to special ticket pre-sales. It's no big secret that most people sign up for fan clubs just to get access to pre-sales. I wonder if Trent objects that his fan club charges people *just for the right* to buy these tickets. After all, the fans would have have the same right to those tickets in the absence of the fan club.
Better watch what your management company is up to, Trent, if you don't like what your record label is doing...because there's not much difference.
Posted by: Nobody | September 20, 2007 at 04:22 PM
The recording industry is smelling a bit funny these days. Good.
There are plenty of bands making it as touring acts. They tour throughout the year with, at most, a six-week break here and there. On the road, they hock merchandise, and tend to hit the summer festival circuit for some quick cash and lots of exposure. As tours progress, they sell full-CD-quality recordings of their live shows as web downloads for around $15 (usually within a week of the performance.) -- and get this: the files are not "protected" with any anti-piracy hoo-hah. They just trust their fans, and understand that anything which gets out illegally can only help them as a live act. In the studio, they are similarly do-it-yourself types, often using their own labels.
I know some of these people, and they're doing just fine. They may not drive Maseratis, but they're raising great kids and supporting their families well with their music. Most of all, they love their jobs. I hope the music industry takes a header right into the L.A. River. It is social-Darwinism in action, and they're an endangered species. Technology will be their undoing.
Posted by: ascr | September 20, 2007 at 08:55 PM
Trent can tell his fans whatever he wants.
after all, hes no fake when it comes to his music, and practically all of it even the stuff he does on soundtracks, is written by him (or at the very least co written with), it is his music, his ideas, his lyrics and words, its his fingers that are basically in control of the music n what is planned to be released, universal are just the makers of the cd's and contracts of how many albums etc they are going to release with him. the record company are just there to say 'yeh, ill go with that' or 'nope, try again'
trents a hard worker on his music, he is an artist, he cares about the way his work is presented, he is basically there every step of the way.
not many artists do that, they sing it and let everyone else and computers muck with it, in the end, its hardley theres, its been manipulated so much. with no offence to other artists (i value their music too)
one man band who gets it right every time or a singer who records then edits and edits until its hardly recognisable? you decide
Posted by: Rosie | September 20, 2007 at 10:50 PM
Why don't the aussies just go online and buy the album from itunes? Those prices don't change based on region (as far as I'm aware). Easy solution, and will send a message to retailers. Also can order from Amazon, etc. for a normal price and have it shipped.
Posted by: Common Sense | September 21, 2007 at 10:07 AM
Actually, the price of NIN songs on iTunes does vary from country to country. That's why Apple is having to defend iTunes in the EU.
Posted by: Jon Healey | September 21, 2007 at 10:26 AM
Here's a Fortune piece about Apple's pricing woes:
http://www.forbes.com/technology/2007/09/20/apple-itunes-europe-tech-cx_pco_0920paidcontent.html
(Thanks to Coolfer for spotting it.)
Posted by: Jon Healey | September 21, 2007 at 02:29 PM
Actualy Trent does hold all rights to all of his works, check out ASCAP. He has also written everything that he has released. A vast majority of "artists" today can not say the same.
Posted by: PhoenixAmazon | September 21, 2007 at 04:06 PM
The ASCAP listing refers to copyrights in the compositions -- in other words, who owns the rights to the notes and lyrics. There's a second set of copyrights that relate to the recorded performance -- how the notes and lyrics were played and sang on the CD. Even if Trent holds all the songwriting copyrights, he may not (and I doubt that he does) own the rights to the master recordings. The record labels typically get those in exchange for paying advances against royalties.
Posted by: Jon Healey | September 21, 2007 at 04:17 PM