Priceline for Music: Radiohead Lets Fans Determine CD Price

The 10-track CD was released on inrainbows.com yesterday with one simple twist - the user determines the price - from a penny to who knows what price. From all reports, the experiment has been a success technically but no word yet on profitability.

Some will hail the effort as yet another example of the ever-growing power of the individual user in the post-Web 2.0 world, while others will question the sustainability of a truly open pricing model.

Clearly, the move by Radiohead was likely more promotional gambit than new business model. Yet, on a personal level, I admit it's hard to know the figure to put in the price box. Less than retail? A lot less than retail? More than retail to reward the band for this bold move? I suspect other Radiohead fans face the same conundrum.

Needless to say, we'll likely never know exactly how much money the band makes with "Priceline-ing" In Rainbows or either the average price or the lowest-highest bids. Still with more artists shedding ties with record labels, bands increasingly need to find new channels and methods to replace the marketing and distribution capabilities once provided by the label.

For those who find the "name your price" model too disorienting, the hard copy of Radiohead's latest will be in stores early in 2008 -- presumably with less-ambiguous pricing.

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