Free Download Model Leads To Grammy Nomination

Recordings were always looked at as loss-leaders to musicians on major labels. They rarely ever recouped their advances on actual sales. And even when they did, it was hardly enough to live off of. Even back in the heyday of the industry, most musicians made their money on the road in ticket sales and merchandising.

Just because musicians now have direct access to their fans and can make up to 100% of the sale of a digital download (or 70% from iTunes) doesn’t mean they need to employ the same old-school, major label philosophy of the pay wall.

The Milk Carton Kids

Los Angeles Based, The Milk Carton Kids, give away their first two albums as free digital downloads and to date the albums have been downloaded a combined 250,000 times. This immense exposure and lack of a pay wall lead to them gaining worldwide recognition and many opening touring gigs as well as gaining the attention of Anti Records. Now signed to Anti Records, they have kept their first two albums available for free download. They are touring the world very successfully (packing clubs wherever they go).

Their new album, Ash and Clay (the one nominated for a Grammy for Best Folk Album) is their first album released with Anti Records. This release is not available for free download however. Remember this is the label’s decision. I don’t expect labels coming around to the pay what you want model anytime soon. If you’re not on a label, you don’t have any rules you MUST follow. This worked for them. Could it work for you?

Fun fact, when they first formed in the Summer of 2010 they opened my Midwest tour and I opened their California tour.

Pretty Lights

Pretty Lights (similar to many other EDM artists) has been giving his music away since the beginning. He built up a strong following on SoundCloud and his new Grammy nominated album A Color Map Of The Sun, is available for free download on his site.
**Thanks to Zach David for pointing this out

Other Artists Who Successfully Use The Free Download/Pay What You Want Model

Jeremy Messersmith

I’ve known Jeremy for many years as we’re both from Minneapolis. He is one of the biggest acts in Minnesota  and packs the legendary 1,600 seated First Avenue (of Purple Rain fame). He recently signed to Glassnote Records (Mumford and Sons). Before he signed, he gave away all of his music as digital downloads for ‘pay what you want’ via BandCamp. He still offers this on his website. He tours the country regularly.

Rogue Valley

Rogue Valley, also a Minneapolis band, (the lead singer, Chris Koza, co-wrote most songs on my upcoming record with me) similarly gives away all of their music as digital downloads for ‘pay what you want via BandCamp (they happen to have the same management as Jeremy). They have a song on the new The Secret Life of Walter Mitty soundtrack alongside Of Monsters and Men, Jose Gonzales, Jack Johnson and David Bowie among others.

Roster McCabe / Night Phoenix

These guys built their career on the live show. I lived with a  few of them for years in Minneapolis and helped manage them early on. They recently changed their name to Night Phoenix (after a member change), but over the past few years have been selling out venues around the country and pack the 1,000 capacity historic Cabooze in their hometown of Minneapolis. They are a live band. They give away all of their music (including CDs at shows) for ‘pay what you want.’

I’m not telling you to absolutely give away your music, but it can be part of your overall approach. Collecting emails and zip codes for free downloads has worked tremendously via Noisetrade and BandCamp for many touring artists.

Remember, though, just giving away your music is not a strategy in it of itself. It’s part of the overall equation. You still need a promotional strategy (and great music) that sets you above the thousands of other bands doing the same thing.

Have you had success in a ‘pay what you want’ model? Share in the comments.

34 Responses

  1. adryelle

    I have given away some of my music as pay what you want and alot of times people pay anyway. Once someone paid 20 for a 5 song ep that i would have only charged 5 bucks for. I know several musicians who got many oppurtunities because of giving their music away for free. I give my music away as free downloads but still charge for physical copies.

    • visitor

      jesus ari – who’s paying you to be the king of strawmen?

  2. Zach

    You forgot to mention Pretty Lights, whose album, A Color Map Of The Sun, is up for Best Dance/Electronica album and is a free download on his website Pretty Lights is another example of an artist who has released most of his music for free.

  3. GGG

    A tour I did a few years ago we did the pay-what-you-want for a CD since we had about 200 really cheap “promo” copies left, so CD in plain white sleeve. We ended up with none left and basically the same amount of money as if we charged $7-8 for all of them.

    • Anonymous

      Yes, pay-what-you-want works in small scale live situations and a few other intimate scenarios.

      Otherwise, it’s been dead since Radiohead.

      All in all, another absolutely useless story from Ari…

      • GGG

        Right, but aren’t you always bitching about smaller/middle class artists? There’s sort of three points that come from this. 1) It can work and be enormously helpful for smaller acts 2) it shows creative (using that term loosely since this isn’t particularly creative anymore) models can be better than sticking to the status quo and 3) as much as it may hurt your ego, your music doesn’t have the same value to other people as it does to you, nor does it have the same value across people. If you want to say ‘my music’s $10 and if you don’t wanna pay that fuck off,’ that’s your prerogative. And for some goods, I’m like that too. Vinyl for example, I don’t mark down or give away. Though, sometimes if someone wants to bundle it with a shirt or something I do, but sort of different story. But anyway, I know for a fact, we wouldn’t have sold those 200 CDs for $8 if that’s what the sign said. Because we hadn’t the previous tour with actual well-packaged versions. It’s a stupid psychological thing, but might as well take advantage of it.

  4. TuneHunter

    Ari, those are very encouraging cases you bringing up but they will not support the industry.
    Also current reality of free with some ad and sub income cannot be our future.
    Internet actually allows for major monetization of music.
    The amount of new brilliant music and the number of musicians entering the scene calls for 100B industry.
    Labels and RIAA better deliver it or someone will do it for them and they will become history.

  5. jim

    The sentence : “Their new album, Ash and Clay (the one nominated for a Grammy for Best Folk Album) is the first album released by Anti Records.” is ambiguous and the way I read it, that this is the first album released by ANTI- (as opposed to the first Milk Carton Kids album released by ANTI-), is just wrong. ANTI- has been around since 1999 and the first album of note they released was Tom Waits’ Mule Variations.

    • Me

      It probably should say “their first release by Anti-.” I can see how it could be confusing to someone who’s not familiar with Anti- and may think it’s an upstart label.

  6. DistanceLeft

    Nitpick; “give away their first two albums” this should be ‘gave’.

    I can see it being OK for small situations or venues, but as a way to run an entire industry not-so-much.

    A few success stories does not a business model make; or a living for any of those people not able to work for free, who have other jobs than performers, or musicians.

    Like say, writers or performers.

    Nice to hear of some music I hadn’t heard of before though, I always welcome that.

    • Ari Herstand

      It actually should be “give” because they currently give their first two albums away. They didn’t ever stop doing this (otherwise that would be gave).

      It starts with just a few. This is part of the bigger question: how should musicians actually make money. Like I mentioned at the start of the piece, musicians never relied strictly on album sales for their income. Why should they now? Making a living in music is much more than just what you’re able to get for your recordings – as illustrated in How 10 Musicians Make Good Livings In Today’s Music Industry

  7. Joshua Hall

    First – Thank You for your Blog. I see this as the “Grateful Dead – Phish” model. Basically Bootlegs. Let fans record your shows and distribute them (especially if you keep certain fan favorite songs off studio releases), except the artist has created the recording to give away. That’s a proven way to build a fan base and will work for a touring band who make the bulk of their income on Ticket and Merch sales at Shows. But the record company is in the business of selling records, not live shows. I haven’t listened to the Milk Carton Kids but I wonder if there is a quality difference between the “free albums” and the “record label album” – better production, actual physical cd or vinyl you can buy? Did the MCKs give high quality physical CD’s away at shows or shipped to their fans via their website?

    Giving away your music is form of Advertising – view it that way – you are building a base for your live shows and perhaps building an audience to actually buy your studio album.
    The Record company is selling a product just like any other company selling physical products (milk, t-shirts, beer, Lysol, CD’s and Vinyl) and yes, sometimes a company will give away free samples to generate interest and buzz, but in the end you wont be in business selling physical product long if you give it away (especially if it costs you anything to make it).

    In the end, MCKs may not stay on a label – they seemed to be doing fine with out them – but would that same album – self produced and gave away for free – have earned them a grammy nomination?


    • FarePlay

      I don’t know about Phish, but I do know about the Grateful Dead. Dead fans were collectors and bought everything the band released and had huge collections of live tapes. Garcia, himself said in a Rolling Stone Interview with Cameron Crowe in the mid 70’s that when people told him all music should be free, his response? No way. I sell my recordings.

      • GGG

        How many live bootlegs were officially released before Dick’s Picks, though? I don’t think many.

        Phish and Dave Matthews Band both encouraged trading tapes, to the point where you could actually request to plug into the soundboard in their (at least DMB’s) earlier days.

  8. Jughead

    Those who do not accept the possibility that royalties from music sales may disappear are burying their heads in the sand.

    It sucks, but when one door closes…..

  9. Bilbao Buggins

    You forgot one of the more successful and celebrated free albums of the year – Killer Mike & El-P’s ‘Run the Jewels’ on Fool’s Gold. Word is over 200k downloads and counting (not including all the unofficial links) +’spots on most ‘Best of 2013’ lists. Apparently sold a grip of vinyl on the back of the hype, which led to the album being picked up internationally by Ninja Tune. Not sure what it means other than releasing great music with a decent marketing strategy and some luck can generate some appreciable results using the ‘free’ model. Won’t work for everyone but if done right, not a bad way to position one’s self. And looking at Run the Jewels touring schedule, it seems to be working quite well for them!

  10. FarePlay

    “Recordings were always looked at as loss-leaders to musicians on major labels. They rarely ever recouped their advances on actual sales. And even when they did, it was hardly enough to live off of. Even back in the heyday of the industry, most musicians made their money on the road in ticket sales and merchandising”

    Playing fast and loose with the facts. We have a problem here. Paul you can’t have editorial staff that has no knowledge of the music business before 1990, writing articles that are factually false.. It is misleading to your readers, who look to this publication for some semblance of accuracy. The music business from 1965 to 1985 changed from a singles business to an LP business and labels underwrote tours to sell recorded music. If you weren’t there didn’t read a book or talk to someone who knew the record business when record stores flourished, you’re dealing with folklore, not fact.

    Don’t reverse engineer, the music business of today to figure out what was going on in the past.

    • Bluestone

      I think your misreading Ari’s statement somewhat. He’s referring to the artists traditionally not making money from recorded music sales, not the record labels. On that point, I’d dare say he’s more or less correct. Rare was/is the artist who profits from the sale of music, while record labels (mainly the majors) had an easier time doing so by employing all types of accounting manipulation/obfuscation/prestidigitation to ensure they recouped every penny possible, and almost always at the artist’s expense. Sure, it could cost a lot to break an act but they weren’t spending that money simply b/c they loved the band; they underwrote tours, payola’d radio promo, etc…, to generate max exposure and sell as many albums as possible so they (and their corporate masters) could max profit for THEMSELVES, not the acts. If you’re going to refer to history, then let’s be a bit more fair & accurate about it. The history book are filled with examples of artists who sold huge amounts of product but didn’t make any money, and some were totally broke after doing multiplatinum units (e.g. TLC). Yes, there were big advances, big recording & video budgets, etc…, but often it was the far from transparent accounting and arguably straight up cozenage that blew up the artists’ balance sheets. Regardless of the era referred to, the common denominator seems to be that artists are rarely compensated in a fair way for their work. Alack, something continues to be rotten in the state of Denmark…

      • Ari Herstand

        Thanks Bluestone.

        Besides the fact that 95% of artists signed to major record labels never recoup their advances (That’s a 95% failure rate (well it’s 98% now), even artists who did recoup their advances rarely made any money from their recordings.

        Here’s an excerpt form Courtney Love’s piece on how artists (don’t) get paid from a successful record (those with a massive advance and a phenomenal (unheard of) 20% royalty rate (from 2000). At the time of her writing, the numbers had changed since the era pre-1990, but the percentages were about the same – actually a bit lower. Talk to any classic rocker. Or attorney. They won’t refute this.

        This story is about a bidding-war band that gets a huge deal with a 20 percent royalty rate and a million-dollar advance. (No bidding-war band ever got a 20 percent royalty, but whatever.) This is my “funny” math based on some reality and I just want to qualify it by saying I’m positive it’s better math than what Edgar Bronfman Jr. [the president and CEO of Seagram, which owns Polygram] would provide.

        What happens to that million dollars?

        They spend half a million to record their album. That leaves the band with $500,000. They pay $100,000 to their manager for 20 percent commission. They pay $25,000 each to their lawyer and business manager.

        That leaves $350,000 for the four band members to split. After $170,000 in taxes, there’s $180,000 left. That comes out to $45,000 per person.

        That’s $45,000 to live on for a year until the record gets released.

        The record is a big hit and sells a million copies.

        So, this band releases two singles and makes two videos. The two videos cost a million dollars to make and 50 percent of the video production costs are recouped out of the band’s royalties.

        The band gets $200,000 in tour support, which is 100 percent recoupable.

        The record company spends $300,000 on independent radio promotion. You have to pay independent promotion to get your song on the radio; independent promotion is a system where the record companies use middlemen so they can pretend not to know that radio stations — the unified broadcast system — are getting paid to play their records.

        All of those independent promotion costs are charged to the band.

        Since the original million-dollar advance is also recoupable, the band owes $2 million to the record company.

        If all of the million records are sold at full price with no discounts or record clubs, the band earns $2 million in royalties, since their 20 percent royalty works out to $2 a record.

        Two million dollars in royalties minus $2 million in recoupable expenses equals … zero!

        How much does the record company make?

        They grossed $11 million.

        It costs $500,000 to manufacture the CDs and they advanced the band $1 million. Plus there were $1 million in video costs, $300,000 in radio promotion and $200,000 in tour support.

        The company also paid $750,000 in music publishing royalties.

        They spent $2.2 million on marketing. That’s mostly retail advertising, but marketing also pays for those huge posters of Marilyn Manson in Times Square and the street scouts who drive around in vans handing out black Korn T-shirts and backwards baseball caps. Not to mention trips to Scores and cash for tips for all and sundry.

        Add it up and the record company has spent about $4.4 million.

        So their profit is $6.6 million; the band may as well be working at a 7-Eleven.

        Of course, they had fun. Hearing yourself on the radio, selling records, getting new fans and being on TV is great, but now the band doesn’t have enough money to pay the rent and nobody has any credit.

        Worst of all, after all this, the band owns none of its work … they can pay the mortgage forever but they’ll never own the house. Like I said: Sharecropping. Our media says, “Boo hoo, poor pop stars, they had a nice ride. Fuck them for speaking up”; but I say this dialogue is imperative. And cynical media people, who are more fascinated with celebrity than most celebrities, need to reacquaint themselves with their value systems.

        When you look at the legal line on a CD, it says copyright 1976 Atlantic Records or copyright 1996 RCA Records. When you look at a book, though, it’ll say something like copyright 1999 Susan Faludi, or David Foster Wallace. Authors own their books and license them to publishers. When the contract runs out, writers gets their books back. But record companies own our copyrights forever.

        The system’s set up so almost nobody gets paid.

        • FarePlay

          If your new way of creating success for artists is so effective, why are nearly 50% of musicians no longer able to file tax returns listing musician as their primary source of income in the past ten years?

          • GGG

            1) “Musicians” doesn’t just mean your rock bands, or rappers, or pop stars. It means downsizing orchestras because anything smaller than a top major city can’t afford to pay them a living wage. It means Broadway shows replacing half the horns and strings with two guys on synths. It means jukeboxes and the bartender’s iPod replacing live music. It means the general idea of live music you didn’t specifically pay to go see unfortunately ain’t what it used to be. Almost none of those people would have made the bulk of their money from selling records, they lose employment because of other sad reasons, lack of people’s interest being one.

            2) Because it’s hard. Always has been always will be. Not everyone who thinks they’re some artist is an artist. People don’t deserve money just because they spent the time creating something. I can’t paint for shit, I could spend 100 hours making some shitty picture, would still be shitty and not worth anything. And hell, even if you’re a fucking genius sometimes it just doesn’t connect. It’s a damn shame but it’s reality. It’s tough. And especially now, everyone is competing for literally half a song’s worth of someone’s time, and if it doesn’t connect in 90 seconds they are on to the next thing, of which the choice is essentially infinite with how much new music is put up every day.

            The current state of musicians is not purely some institutionalized fucking over of artists. It’s part of it, sure, but it’s also a shifting culture, and how people consume and even think about music is different that it’s ever been.

          • FarePlay

            GGG. My turn. I agree with a lot of what you say. For all the cheer leading about access and the wonders of this technology, I see very little optimism or light coming from these times. It all feels like some downward race for the middle. Suck it up.

            As I said earlier, how do you claw your way back from free? How do you create greatness when nobody gives a shit? But you know, right or wrong, I choose to fight for greatness and I refuse to accept that music or film or books are simply some diversion or the prize in a box of cracker jacks.

            What’s happening with creative content is merely a ripple in the ocean of your future. Be very careful of what your willing accept and who is shaping your world.

          • GGG

            It will be tough, I don’t argue that. And, in fact, I would not be surprised in the slightest if it gets worse before it gets better. But my optimism lies in the fact that there is a way to get more people directly monetized from consuming music than ever before. The streaming/subscription models we have now aren’t perfect, but those fundamental ideas are how we make an enormous amount of people individually worth something, as opposed to being one of a rating, or one of a station’s reach or someone who doesn’t buy music at all. Instead of 100M people hearing a song on the radio, you can get 100M people choosing that song on Spotify and Deezer and Rhapsody, etc. And hell, you can still get millions hearing on the radio, I don’t think that’s going anywhere in the near future.

            Spotify has pretty low numbers, a fraction of what YouTube has, yet can get pretty damn close play counts. Imagine what a Spotify with 100M users would generate. Or a Deezer with 100M. Or both of them with a combined number well over that. We’re talking massive numbers. I think there’s a tipping point where unrestricted access to music goes from bad (piracy) to questionable (present day streaming/youtube) to great (normalized streaming/subs).

          • FarePlay

            You said something that hits at the heart of the matter and is at the apex of where I disagree with so many here. You speak of getting more musicians “monetized” than ever before and others speak of the fact that this is all good because there’s more music than ever before.

            Let me respond to.both of these, even though they are somewhat connected as are the answers. And as always, these are simply my opinions.

            > FarePlay’s goal is not to get more people paid. Our goal is to get those who have serious talent fairly compensated. Paid enough so that those who can become great are given the opportunity.

            > Many of these same people who point to the vast, endless ocean of content, speak out of both sides of their mouth. They acknowledge and use it as a measure of success for digital distribution, then turn around and say either artists should just find reward in what they do or worse yet accuse artists of being mediocre and expecting to get paid, regardless.

            I say, if you’re deserving why shouldn’t you be fairly financially rewarded like every other working person? And why should artists be called on to make sacrifices, so they can become wealthy. Look around, this is happening everywhere, not just in the creative community.

          • FarePlay

            Correction: needs to read “so that OTHERS become wealthy.”

          • GGG

            Monetize others, as in listeners/fans, not musicians (though they will obviously overlap at this point). Even when an artist sells 10M records it’s a small percent of people who enjoy that music. Imagine finding that point where instead of getting money from 5% of your fans, you get it from 50%. Or 75%. Not to mention all the people are weren’t yet/aren’t even fans.

            To the rest of your post, I pretty much agree. I’d be the first one to vote to institute some musicianship test people had to take before attempting a career haha. (only half kidding there). But streaming isn’t a sacrifice when the other option is piracy and shit sales. It’s not like album sales were booming and then YouTube and Spotify came along and snuffed them out. Illegal filesharing did that.

            If there’s some way to make everyone buy albums again, I’d be all for it. I’d make more money myself. Between my own situation and fully supporting artists I love, there’s absolutely no reason for me to support streaming if I didn’t think it could benefit people I care about or myself. But there isn’t so far, the ideas are shame people and occasionally sue, which is obviously not working. Vinyl is a bit, I suppose.

            But to me that says we’re past the point of no return when it comes to the divide between the physical and digital age. And unfortunately the HUGE aspects that differentiates the two are an even bigger glut of music, a harder time grabbing attention, and people’s larger appetite for music, which seems good on the surface but I think really just makes people tighter with their wallets. Which is why a sub/streaming model has such potential. All these people that never bought music, or bought a little music, or stopped buying music, are now directly monetized again. We obviously need substantially bigger numbers, but between multiple services, they could get massive.

            Anyway, you don’t need to respond to this, I feel like we’re about to enter our usual circle of arguments hah

        • Chris

          “Authors own their books and license them to publishers. When the contract runs out, writers gets their books back. But record companies own our copyrights forever”

          No they don’t unless you sign a contract for that long – Courtney Love is possibly the worst example to ever use for a musician’s plight – her manager explained to her that all the money she was spending was recoupable but she didn’t listen – that’s bad management, bad legal advice, bad actions by the artists – but no it’s just too easy to blame the big bad record label isn’t it?

      • FarePlay

        Bluestone. Sorry, don’t agree. I worked in the business in the seventies and bands did make money and were paid by the labels and bands had huge hits and got nada. Record labels have never been known for their generosity and integrity, but some did pay.

        Now, were bands penalized and forced to underwrite the money labels lost on bands that failed? Absolutely. I mean they do call it the music BUSINESS. So in order to stay in business someone had to pay for the 9 out of 10 bands that did not sell. And we haven’t even scratched the surface without talking about managers, many of whom were unqualified and dishonest.

        In order for a band or musician to release an album on a label they had to sign a CONTRACT. So bands can/could only be victims if they signed the contract. But let’s not stop with the music business, this happens in the film business just as often and for a lot more money.

        The problem I’m having with you and Ari, is that you use generalizations and half truths to make your point. i mean look at the title of this thing, “Free Download Model Leads To Grammy Nomination”. This is “A” One, 1 strategy that can be successful, not a new way of doing business. And the tragedy? Most bands stake their careers on a handful of songs that catch fire. So I say, to bad these guys couldn’t have made some more money along the way.

        Ari talks about how much money he and his posse make as musicians. Not how much they are giving away. I mean why shouldn’t people pay and why is everyone so focussed on driving this business into the ground?
        Promoting free, whether it is Pandora, Spotify or Ari is not the message we continually want to promote and write about. Anymore than scraping spare change off the pavement from streaming your music.

        Wake up. Tech is loving that we fight so hard for free. Works for them.

        • Joshua Hall

          I’ve been thinking about these examples while I remove the feet of snow around my house. My group performs in a spiritual practice called “Kirtan” – you may have heard of Krishna Das or Jai Uttal – and the tradition is to play by donation. For the past three years, 80% of my gigs (mostly Kirtan, but some Solo Guitar) are done by Donation. I often play Solo Guitar in Yoga classes (flow with the Asanas and improvise or play original compositions for donation) The audience pays what they want/can afford/ think it is worth. I never go home with tons of money but that was never the point, but usually I go home with a lot more than the local “music venues” will pay. I sell CD’s, have downloads, streams, and all of that goes into the pot as well. I never have to pay for a venue or even sell tickets – usually the space is donated as well, and I rarely need a PA System, play in front of Drunk People or stay out after 10PM. Occasionally, something will come up where we will lead a private “kirtan” or I’ll play for a Wedding or corporate function and there is a Fee I charge. I am a full time musician – my primary income is as a public middle school choral and band director. I also do private lessons. My last two CD’s cost me well under $1000 to make combined because I own the recording studio and do all the engineering, mixing, and mastering myself. Sure, its not fancy and I don’t have any Grammy nominations in my future but the people who purchase the recordings are happy to pay the $15 I ask at shows and absolutely love them. We have a very dedicated fan base. You may poo-poo the fact that I am a “music teacher” but let me remind you that Sharon Isbin (Head of the Guitar Dept. at Julliard – tours and is a teacher) as are countless others – so I see it as another gig – a great one with health care benefits and a retirement plan, much like the good Orchestra Gigs.

          It always amazes me how much it costs a Label to make a CD. I like the Frank Zappa model – own the studio and own the label and most important – own the music.


  11. Versus

    “Recordings were always looked at as loss-leaders to musicians on major labels. They rarely ever recouped their advances on actual sales.”

    The advance is income to the artist. One could make a living from the advances alone, even on smaller labels, even if they did not recoup.

    • Ari Herstand

      As Courtney Love put it: with a 4 piece band and a million dollar advance, after recording costs, taxes, manager and lawyer fees, split 4 ways, each band member has about $45K. Middle class. For one year. However, no one gets million dollar advances anymore.

  12. hippydog

    In many ways the “new fremium model” is a lot like the really old model.. IE: the one the music industry used before art could be mass produced..
    Back then artists had to build a name for themselves before getting paid, basically once people start looking for you specifically you can charge what you want, how you want but you need to be known first..