Pay as you Like

When anybody with basic computer skills can download music, buying it online has almost become an altruistic act. If it’s free, why pay for it other than to support the artists they enjoy? (Well, there is the remote chance they are scared of getting sued.)

Some internet companies are taking a "glass is half full" approach to this situation. They are banking on the goodwill of people who already buy online, and hoping they would be willing to pay more for music if it were to benefit the artist.

The older of the two companies out there - that I know of, at least - is MagnaTune. The site allows listeners to hear the site’s catalog of artists for free. But to download songs, users have to pay. The site has a base charge, but a buyer can choose to pay more for a song if they like. All money is split with the artists 50/50.

And the new cat on the block is SongSlide. They start songs off at 59 cents, and allow buyers to slide a bar up to donate more money, with all of the extra profits going to the artist.

The catalog of these sites is very limited and makes them more of an interesting experiment with a good faith business model.

But can it pay off? The co-founder of SongSlide, Devin Brewer, tells Freakonomics that the average song sells for $2.08. But this may be due to the novelty of the site, and its limited audience. More telling may be the sale prices at the older MagnaTune. While the site doesn’t provide average sales data on their statistics page, their albums with the highest average sales prices are not that encouraging. Few sell for much more than the base rate of $8.00.

"Music Burgler"

Another telling anecdote may be the experience of Jane Siberry. At first, she allowed listeners to download her music free, but gave them the option to pay. The model was successful… only until she got some media coverage. She then got a swarm of new listeners - who decided to download and never pay.

Take from this what you will, but buy music. (How much have you spent on alcohol this month, hm?)