See discussions, stats, and author profiles for this publication at: https://www.researchgate.net/publication/240730067
Radiohead's Managerial Creativity
Article in Convergence · May 2009
DOI: 10.1177/1354856508101581
CITATIONS
READS
20
300
1 author:
Guy Morrow
University of Melbourne
49 PUBLICATIONS 138 CITATIONS
SEE PROFILE
Some of the authors of this publication are also working on these related projects:
New Music Industries View project
Artist Management Research View project
All content following this page was uploaded by Guy Morrow on 18 December 2017.
The user has requested enhancement of the downloaded file.
Convergence: The International
Journal of Research into New Media
Technologies
http://con.sagepub.com
Radiohead's Managerial Creativity
Guy Morrow
Convergence 2009; 15; 161
DOI: 10.1177/1354856508101581
The online version of this article can be found at:
http://con.sagepub.com/cgi/content/abstract/15/2/161
Published by:
http://www.sagepublications.com
Additional services and information for Convergence: The International Journal of Research into New Media
Technologies can be found at:
Email Alerts: http://con.sagepub.com/cgi/alerts
Subscriptions: http://con.sagepub.com/subscriptions
Reprints: http://www.sagepub.com/journalsReprints.nav
Permissions: http://www.sagepub.co.uk/journalsPermissions.nav
Citations http://con.sagepub.com/cgi/content/refs/15/2/161
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 161
Convergence: The International Journal of Research into New Media Technologies
Copyright © The Author(s), 2009. Reprints and permissions
http://www.sagepub.co.uk/journalsPermissions.nav
ARTICLE
London, Los Angeles, New Delhi, Singapore, and Washington DC
Vol 15(2): 161–176
DOI: 10.1177/1354856508101581
http://con.sagepub.com
Radiohead's Managerial
Creativity
Guy Morrow
Macquarie University, Sydney, Australia
Abstract / This article will explore the way in which Radiohead have been managerially creative
through their use of new media technologies. The band released their seventh album In Rainbows
on the 10 October 2007 as a digital download for which consumers chose their own price: beginning at nothing. The issue of whether this example presents a model for other artists to bypass
established record labels will be explored. This article will also use this discussion to look more
broadly at how artist managers create marketing strategies that involve new technologies and in
doing so it will address various issues concerning the future management and control of the five
key income stream groups stemming from contemporary music in the digital age. While Radiohead
are in a position to be able to control all of their own income streams, they have only gotten into
this position as a result of the old system.
Key Words / artist management / creativity / MySpace / new technologies / YouTube
Introduction
British rock band Radiohead released their seventh album In Rainbows on the 10 October
2007 as a digital download for which consumers chose their own price: beginning at
nothing. This digital release was followed by the release on 3 December 2007 of a ‘disc
box’ with a second CD, two vinyl records, artwork and lyric booklets (InRainbows.com,
n.d.). The album release is the first by the band after the end of their contract with EMI.
The commercial success of the album is still unclear however as the album’s download
and ‘disc box’ sales are not eligible for inclusion in the UK Albums Chart because the
website is not a chart-registered retailer (Brown, 2007). However, it is evident that a
number of the songs that were able to be downloaded received airplay on the Modern
Rock radio stations in the USA following the album’s internet release. Musically speaking,
In Rainbows is an ‘accessible’ album. While the third track ‘Nude’ is texturally sparse and
features lead singer Thom Yorke’s trademark brooding and paranoid vocals, the second
track on the album ‘Bodysnatchers’ has a bouncy, grinding quality that is refreshing and
atypical for Radiohead.
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 162
162
CONVERGENCE VOL. 15 NO. 2
In October 2007 Murray Chalmers, a spokesperson for the band, revealed that
‘most people are deciding on a normal retail price with very few trying to buy [the
download version] for a penny’ and that most fans had pre-ordered the disc box (BBC
Open News Archive, 2007). According to Gigwise.com, by the 10 October 2007 the
album had sold 1.2 million copies of the downloadable version (Brandle, 2007). However
this claim was dismissed by band co-manager Bryce Edge as being ‘exaggerated’ (Brandle,
2007). According to an internet survey conducted by Record of the Day of 3000 people,
about one-third of people who downloaded the album paid nothing, with £4 being the
average price paid (Sherwin, 2007). According to internet research group ComScore, 60
per cent of consumers who downloaded the album opted to pay nothing, with the
average price being only £2.90 (InTheNews.co.uk, 2007). A statement from the band
refuted the study, describing it as ‘wholly inaccurate’ and adding that it was impossible
for outside organizations to obtain accurate sales figures (NME.com, 2007a). An informal
survey of the readers of music magazine NME claimed that an average price of £5 was
paid (NME.com, 2007b). The band’s management have not to date released any official
sales figures.
This article will explore the way in which Radiohead have been managerially creative
through their use of new media technologies. In particular, the issue of whether this
example presents a model for other artists to bypass established record labels will be
examined. This article will also use this discussion to look more broadly at how artist
managers create marketing strategies that involve new technologies such as ring tones
for mobile phones, video websites such as YouTube, and online communities such as
MySpace to supplement the more traditional avenues for exposure.
Radiohead Take Control
This article employs Watson’s (2002) argument that the unique relationship between
artist and manager is the nucleus around which a successful musical career revolves.
In order to develop this argument further, Watson uses a bicycle wheel analogy to
describe the structure that evolves due to the fact that (if successful) eventually the
manager and the artist will assemble a network of other relationships to try and further
the artist’s career. Watson claims that the artist and manager might build a team that
includes record company staff, booking agents, live crew, publicists, accountants, music
publishers, record producers, merchandisers and many other specialists. His analogy
involves the unique combination of the artist and manager constituting the hub in the
middle of a wheel. The artist and manager together work out where they want to go
and how they want to get there. They then start assembling the additional members
of the team around the hub like the spokes of a wheel. While the individual spokes
themselves are important, the artist/manager hub remains pivotal in every situation.
Even after the artist and manager have assembled all the right ‘spokes’, the career
‘wheel’ still needs to be persuaded to roll in the right direction. Watson states that
most of the responsibility for this persuasion usually falls on the shoulders of the
manager as their main job is to coordinate and persuade. This is why if an artist is to
become creatively and/or commercially successful, their career demands at least
as much management as there is talent and ambition (Frasogna and Hetherington,
2004: 7).
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 163
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
163
Radiohead are managed by Chris Hufford and Bryce Edge for Courtyard Management. They have been working with the band for approximately 18 years. Hufford and
Edge co-own Oxford’s Courtyard Studios and they produced demos for the band when
they were known as ‘On a Friday’. The band signed a six-album recording contract with
EMI in late 1991 and changed their name to Radiohead. While the artist–manager
relationship between Hufford, Edge and Radiohead has always been pivotal, in the
digital era there is increased pressure on the artist and manager relationship that forms
the ‘hub of the wheel’. This is leading to tension between artist managers and record
companies.
After Radiohead had met the commitments pertaining to their six-album deal with
EMI (that also included a further live album), they were presented with a unique opportunity. While they could sign to another record label, they no longer needed that spoke
of the wheel. In relation to why Radiohead did not negotiate a new agreement with EMI,
Edge commented that:
We couldn’t move ahead with EMI because Guy Hands [EMI’s new owner] irrevocably refused to
discuss the catalogue in any meaningful way. We sold 25 million records and we have the moral
rights over those six albums. We wanted a say in how they are exploited in the future. We were not
seeking a big advance payment, or a guaranteed marketing spend as discussions never got that far.
(Atease.com, n.d.)
Therefore the main reason why Radiohead did not move forward with EMI was that their
demand for control over their back catalogue was rebuffed. The band’s first six albums
will not be released from EMI’s control for the 50-year period allowed by copyright law.
Edge also noted that artists are upset that record companies still deduct ‘packaging costs’
from royalty payments on digital downloads, which require no packaging. Furthermore,
Radiohead’s original EMI contract had no facility for digital sales, so they did not receive
royalties through sales from the iTunes store. ‘It’s no surprise that artists are throwing
their arms up in the air,’ Edge said (Atease.com, n.d.).
After their departure from EMI, the band and manager team were able to be
managerially creative through investing their own money into the development of an
online infrastructure that would enable them to leverage the strength of their brand name
and control the digital distribution of their recordings to a certain extent. They also
invested their own money into the production of a disc box set. Radiohead were only
able to do this however because they are a product of the old system. Not only were
they in the unique position of being a band that had the financial resources to be able
to build an online server that would be powerful enough and online credit card facilities
that would be reliable enough, Radiohead’s brand name as it exists today is the result of
EMI and other business entities’ global investments in it over a long period of time. To
say that Radiohead’s new business model is a viable one for independent artists to follow
in the future is problematic because it was to a large extent dependent on EMI’s success
marketing the band’s previous six albums. Radiohead’s lead singer Thom Yorke made the
following comments concerning their unorthodox approach:
It’s not supposed to be a model for anything else. It was simply a response to a situation. We’re out
of contract. We have our own studio. We have this new server. What the hell else would we do?
This was the obvious thing. But it only works for us because of where we are. (Thomson, 2007)
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 164
164
CONVERGENCE VOL. 15 NO. 2
Yorke also made the following comments concerning digital rights issues in recording
contracts:
You don’t sign a huge record contract that strips you of all your digital rights . . . So that when you
do sell something on iTunes you get absolutely zero. That would be the first priority . . . I don’t see
a downside at all to big record companies not having access to new artists, because they have no
idea what do with them now anyway. (Thomson, 2007)
In the light of these issues, Radiohead’s unorthodox approach was clever. While it
was perceived in some parts of the media as being unsuccessful because allegedly
numerous consumers downloaded their music for free, such a perception is dependent
on a narrow view of the music business. From the perspective of the actual artist and
their management, the sale of recordings in different formats only generates one in five
potential income streams. Artist managers conceptualize the business holistically in terms
of income that can be generated from live performances, merchandise sales, song
publishing, sponsorship deals, as well as record sales.
Radiohead’s manoeuvre was successful because it not only functioned as a huge
publicity stunt for an older band that was releasing their seventh album, it directed a large
amount of traffic to their website from which consumers could purchase concert tickets
and various items of merchandise. Consumers were also asked for their information when
they downloaded the album and so, in addition, the exercise was useful in terms of future
direct marketing efforts. Furthermore, the stunt had the potential to increase the sale of
their back catalogue of albums and the fact that it led to increased radio airplay and
concert appearances would have increased song-publishing revenue. The initial online
release has not only led to the band allegedly selling 1.2 million copies of the digital version
for an average of £5 in the first two weeks, with them receiving this money directly rather
than them having to wait the usual 90 days for the record company’s payment cycle, the
strategy grew their business in a holistic way (Gigwise.com, n.d.). In the process, they also
maintained their reputation for being innovative and they have been proclaimed heroes
of a new independent movement in the music business. Radiohead are also in the position
to license the online infrastructure they have developed to other artists. Furthermore it
drew attention to the hard copy release of the album In Rainbows that contains bonus
tracks that were not initially available for download. This hard copy version was released
through various independent record labels around the world.
There is an established debate in the popular music studies canon concerning the
rock genre’s struggle for authenticity in relation to the commodity form (see Adorno,
1989; Frith 1996). Popular music is often considered to be unique in the extent to which
the makers of this form of art struggle with their role as commodity producers. Radiohead, being the epitome of the (post)modern art rock band, is important here because
they have brought their own artistic sensibility to organizing their commodification.
However a new paradigm of thought is emerging in which artistic ideas are merging
with processes of commodification more broadly speaking. In contrast to the way in
which Adorno (1989), Middleton (2001), Hirsch (1970), Becker (1976), and Peterson
(1976) argue that cultural organizations1 behave like non-cultural organizations and treat
artistic work as a ‘product’, in the digital age it is the reverse: non-cultural organizations
are in fact beginning to behave more like cultural organizations by considering their
output to be an ‘experience’.
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 165
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
165
Pine and Gilmore (1999) have labelled this phenomenon ‘the experience economy’.
They argue that competing on the basis of price is no longer an option for many
companies and that instead ‘experiences’ represent an existing but previously
unarticulated ‘genre of economic output’ (1999). They note that:
The newly identified offering of experiences occurs whenever a company intentionally uses services
as the stage and goods as props to engage an individual. While commodities are fungible, goods
tangible, and services intangible, experiences are memorable. Buyers of experiences . . . value being
engaged by what the company reveals over a duration of time. Just as people have cut back on
goods to spend more money on services, now they also scrutinize the time and money they spend
on services to make way for more memorable – and more highly valued – experiences. (Pine and
Gilmore, 1999: 12)
While this approach to value adding is not relevant to a study of artist management
because the ‘experience’ of artistic products is more often than not the focus anyway,
Pine and Gilmore’s work does reinforce the argument that non-culture-producing organization are (in some sectors) beginning to behave more like cultural organizations and this
new paradigm goes against the grain of the already established debate in the popular
music studies canon concerning authenticity and its relation to the commodity form.
The Rise of the Artist Manager
While in the case of Radiohead there is more pressure on the artist and artist manager
relationship because they have initially bypassed major record labels for the release of In
Rainbows, Welsh notes that in general the online environment is leading to more pressure
being placed on artists and managers because of the amount of research that is required
into online outlets and marketing:
Because the major record labels don’t really have those research departments, it is my observation
that is it becoming more up to the artists and the artist managers themselves to be aware of what’s
happening and to figure out how they are going to use it: even if they are signed to a major label
record deal. It doesn’t matter who their partner is generally; whether it’s a big record label, a small
record label or a music publisher or another type of partner, those people also don’t know what’s
happening because they don’t have the time to do the research. The people who do it well tend to
be the people who select what they have seen work before. What they do is they select 20 to 30
websites that they are going to concentrate on. (Welsh, 2007)
Time to research effective ways to release music online has become a key asset that
artists and artist managers need and Radiohead’s experiment has sparked a discussion
concerning the most salient methods. Radiohead have had a successful career as recording artists as a result of being supported by the old system that featured the dominance
of labels such as EMI. Therefore while it initially appears that they may be closing the
door for future artists to receive similar heights of commercial success by making use of
a model that embraces free downloading, they also represent a transitory phase for the
business. While their method of distribution may not be sustainable in terms of the old
paradigm, smaller operators may still be able to learn from it.
From Mass-Marketing to Niche Marketing
Radiohead’s brand was built through mass-marketing and it is the product of the star
system that dominates the record business. However, ironically, their latest independent
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 166
166
CONVERGENCE VOL. 15 NO. 2
online release strategy is helping the music business shift to a new paradigm in which
niche marketing will dominate. Frith (2001) argues that the vast majority of the record
industry’s products are economic failures because they fail to cover their costs. He points
out that such losses are more than covered by the size of the returns on successes, which
means that ‘star-making, rather than record selling, is a record company’s core activity:
the latter is dependent on the former’. However, Kusek and Leonhard (2005) argue that
a new ‘middle class’ of artist is arising as niche marketing replaces mass-marketing in the
digital age. They note that:
The idea that an artist has to sell more than five hundred thousand records to be successful is a
bizarre myth propagated mostly by the music cartels that have to make up for the huge overhead
they carry . . . If and when musicians can define their niche, truly differentiate themselves, and find
efficient ways to reach out to people who are interested in their uniqueness, they can be successful on much smaller volumes reaching far fewer people. (Kusek and Leonhard, 2005: 26)
Through the use of new media technologies a new middle class of artists may come to
thrive. While Radiohead have been able to use their star status to challenge the status
quo, their latest efforts are helping to develop a business that will be less dependent on
‘hits’ and ‘stars’.
In order to answer the question of exactly how this middle class of artist will emerge
through the use of new media technologies, Kusek and Leonhard analysed the emergence of the online porn business. They argue that the online music business has
followed, and will continue to follow, the same pattern that the online porn business did.
The internet eliminated a huge barrier for entry into the porn business (such as publishing a magazine) and therefore the internet made it possible for new independent porn
businesses to flourish. They note that the secret to the success of these independent
businesses was that they banded together in the online environment: ‘Whether intentionally or out of necessity, the nascent industry worked as an online cooperative to
promote and establish itself, and expand its influence a thousandfold over the former
incumbent moguls of porn, mostly just by using free pix and lots-o-links’ (Kusek and
Leonhard, 2005: 27).
Obviously, online porn growth was also driven by the search engines Yahoo, Altavista,
Google and others that provided pointers to porn websites containing key words such
as ‘sex’. Kusek and Leohard note that once you got to many of these sites, you were
exposed not only to the porn you were looking for, but also to a vast array of links to
other, associated porn sites. Social networking websites such as MySpace Music operate
in a similar way through enabling the consumer to link through to other niche marketed
artists via the ‘friends’ function. While Radiohead’s home page is not a social networking site that is in the same vein as MySpace, they have embraced peer-to-peer file sharing
as an exercise in social networking. Kusek and Leonhard note that:
The industry propelled the fortunes of the early online porn Webmasters by banding together to use
the Web’s hyperlinking capabilities. Some of the largest sites are actually elaborate networks of nichemarket sites joined together to trade traffic. This collective behaviour was perhaps the most important marketing tool that the porn Webmasters had at their disposal. Adult sites formed very large
circles of sites, all linked to one another to boost the popularity of their links and their ranking on
the search engines. If musicians today could execute on this strategy, they could usurp the power
of radio and the major labels, once and for all. (Kusek and Leonhard, 2005: 27)
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 167
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
167
While one of the factors that led to the emergence of successful independent online
porn businesses was the industry’s embrace of the internet’s hyperlinking capabilities,
another important element was the industry’s use of free giveaways to encourage traffic.
While Kusek and Leonhard’s analogy between the porn business and the music business
has illuminated some similarities, there are also some important points of difference
between the two businesses that need to be pointed out here. Music is different to porn
here in that with music, indications of popularity (sales figures, download figures and so
on) are often an essential part of the marketing process whereas with porn they are not.
Viral new music producers can also use existing social networking facilities like MySpace,
rather than having to construct their own networks.
Marketing Converging with Distribution
Through making their album In Rainbows available as a download from their website,
and letting consumers price it themselves, Radiohead have provided their audience with
an additional channel for discovery that has worked well in conjunction with traditional
radio. Furthermore, in the case of In Rainbows initial access to the music has converged
with ownership of it. Radiohead found a way to unobtrusively and interactively introduce
their new music to their audience through pitching the initial online release of In
Rainbows somewhere between a radio podcast and an iTunes style download. Such a
file-sharing exercise has generated a reawakening of radio; this time however, it is
controlled by the band. Such a radio/digital music service has also been tied seamlessly
into a music distribution system. The fact that the music could potentially be downloaded
for free did not so much devalue the music as a ‘product’, rather it further facilitated the
role that radio has played in music marketing processes in the past. In terms of the market
for their music, the prey became the hunter. Rather than going to the potential consumers
with a big ‘top end’ marketing campaign, Radiohead got the market to come to them.
Access to potentially free content enabled the word-of-mouth process to begin concerning their music.
The process of mass-marketing recordings via playlist-homogenized broadcast radio
stations has been superseded by a methodology that facilitates niche marketing. Kusek
and Leonhard note that:
Digital music services such as iTunes, Musicmatch, Rhapsody, MSN, and Virgin Digital report that
community features are major drivers of discovery for new music. Features such as swapping playlists with other people, or lists of the ‘top 10/20/100 most played songs,’ or ‘people who bought
this also bought that’ recommendations help fans discover new music online. (2005)
Radiohead’s online release method enabled such communal discussion to begin and it
emphasizes the notion that the key to success in niche marketing music is to focus
promotional dollars where they will bring the highest return. Rather than traditional
avenues for exposure, Radiohead used new media technologies to ‘broadcast’ their music,
and their strategy then rolled out in a way that allowed the highest possible conversion
rate from ‘interested user’ to ‘buying customer’.
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 168
168
CONVERGENCE VOL. 15 NO. 2
Perpetual Upgrading
Recorded music has for too long been a ‘static’ product. Rather than releasing a single
unchanging album of songs and spending a copious amount marketing it, Radiohead
have instead started to operate like video game and software manufacturers by creating
products that consumers ‘try first: then buy’. Furthermore their ‘product’ is upgradeable
and they have developed an ever-expanding array of services and products (or ‘formats’)
in which to sell their product: bundling, repackaging and co-marketing. Radiohead initially
released the album as a 48.4 MB ZIP file containing 10 ⫻ 160 kilobits per second (kbps),
Digital Rights Management (DRM) free MP3s. This initially frustrated some segments of
Radiohead’s fanbase because all of Radiohead’s previous albums are already available as
MP3s encoded at 320 kbps – the highest-possible compression rate in the format (though
still not nearing the quality of a compact disc) – and many file-sharers reject anything less
than 192 kbps.2 Some also took issue with when Radiohead chose to announce that In
Rainbows would be available at 160 kbps – after the majority of their fans had already
paid for the download. However, the band did give potential customers the power of
choosing how much they wanted to pay to download the album.
Concerning why Radiohead chose to release the album as 160 kbps, Radiohead
guitarist Jonny Greenwood commented: ‘We talked about it and we just wanted to make
it a bit better than iTunes, which it is, so that’s kind of good enough, really. It’s never
going to be CD-quality, because that’s what a CD does’ (Hiatt, 2007). With hindsight
however, it appears to have been a strategic decision on behalf of the band and management company to initially release the album at a bit rate that is less than the highest rate
possible.
Through employing a strategy that lets consumers purchase ‘upgraded’ versions of
their product, Radiohead have enabled their music to become a more fluid and participatory entertainment experience and this is where its real value lies (Kusek and Leonhard,
2005: 34). By early 2008, when consumers used a search engine such as Google to find
Radiohead’s website and then clicked on the most official looking website that was
marked by having RADIOHEAD in capital letters, they were greeted with the message:
‘In Rainbows is no longer available as a download. You can purchase the discbox by
clicking here’ (InRainbows.com, n.d.). When consumers click on this link they are taken
to a page on which the following message is displayed in capital letters:
DISCBOX: THIS CONSISTS OF THE NEW ALBUM, IN RAINBOWS, ON CD AND ON 2 X 12 INCH HEAVYWEIGHT VINYL RECORDS. A SECOND, ENHANCED CD CONTAINS MORE NEW SONGS, ALONG WITH
DIGITAL PHOTOGRAPHS AND ARTWORK. THE DISCBOX ALSO INCLUDES ARTWORK AND LYRIC
BOOKLETS. ALL ARE ENCASED IN A HARDBACK BOOK AND SLIPCASE. THIS PRICE IS INCLUSIVE OF
SHIPPING. WE AIM TO DESPATCH YOUR ORDER WITHIN 10 DAYS. (InRainbows.com, n.d.)
The price for this discbox is £40. From the home page of this website, consumers can
link to pages on which they can purchase various items of clothing, audio and visual
material, books and posters and badges, calendars and key-rings from the Radioheadowned merchandise company W.A.S.T.E.
Kusek and Leonhard (2005: 83) note that while piracy of video games is rampant, it
really has not hurt the industry or threatened its existence in the same way that it has
hurt the music industry. They also note that the same can be said for the personal
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 169
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
169
computer software market (with 57% average piracy, yearly) and the video market overall.
They argue: ‘The main reason that piracy has not negatively impacted the video game,
video, or PC software business – and may have actually enhanced sales – is that the
producers and developers are constantly reinventing their products’ (Kusek and Leonhard,
2005). Radiohead have embraced a business model that is driven by the constant reinvention of what they can provide consumers. Consumers can buy ‘upgraded’ versions
of the product. While they began distributing highly compressed MP3 files, consumers
can now buy high fidelity vinyl and CD versions of the product. Because it is not a static
‘product’ and is instead an ongoing participatory ‘experience’, Radiohead have a better
chance of beating piracy because the most accessible version (the highly compressed MP3
files) quickly becomes obsolete.
Furthermore Leonhard (2008) notes that the music and media industries are increasingly becoming user driven. This means that the differentiation between ‘producers’ and
‘consumers’ is fading and this is having a fundamental impact on the music business.
Rather than being marketed to in a ‘top down’ way by a record company, Radiohead’s
audience has become a part of the ‘bottom up’ paradigm. Piracy in this case is also limited
because a culture of participation and dialogue has in a way replaced other antiquated
methodologies that feature monologues between music business entities and their
customers. By constantly upgrading their output in the way that they have, Radiohead
have been able to generate a culture of participation and they have been able to get a
large amount of attention; and in the digital age attention is money (Leonhard, 2008).
The Flow of Creativity
In this way Radiohead’s marketing campaign is concerned more with the process of
constant invention and reinvention and less with trying to mass market a static ‘product’.
This evolving process is also more reflective of the artistically creative process. For
Csikszentmihalyi (1996), ‘flow’ is the psychological state that creative people experience
during the process of creation. He argues that the state of flow is an ‘almost automatic,
effortless, yet highly focused state of consciousness’ (1996: 10). He posits that it is this
‘feeling’ that drives creative people (rather than money or fame). Flow often involves
painful, risky, difficult activities that stretch one’s capacity and that involve an element of
novelty and discovery. Through employing a marketing and release strategy that enables
the process of invention and release to flow freely, the musicians are potentially able to
stay in the enjoyable state of ‘flow’ through constantly writing, releasing and performing new material. This sense of energy is evident in the following comment by
Radiohead’s co-manager Bryce Edge:
Both the band and us are so proud of this record, we want as many people to hear it as possible
. . . The band are so excited; they are turning up to meetings full of ideas. With them in that kind
of mood, who knows what could happen before the physical release in January? They could turn
up with a whole pile of new material. It’s entirely on the cards. (MusicWeek.com, 2007)
Furthermore, by shifting the focus away from marketing a static product, artist
managers are able to stay in a state of flow. This is because artist managers often are
not only driven by economic forces, such as generating income to pay their rent, or
working towards the chance that they will see a large financial return from their
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 170
170
CONVERGENCE VOL. 15 NO. 2
investment of time and energy. Artist managers also derive enjoyment out of the ‘flow’
(Csikszentmihalyi, 1996: 110) of creativity in management. It is the optimal experience
generated by the challenge of artist management that drives many artist managers and,
like creativity in music, creativity in management is inexhaustible. The use of new media
technologies in the music industry therefore has great potential to link the motivation
(and potential satisfaction) of managers to the motivation of musicians.
The work of mediators such as artist managers has also been pursued by Pierre
Bourdieu (1986, 1993) who adopted the concept of the ‘cultural intermediary’ to refer
to such occupations. In addition to an artist manager’s ‘creativity’ and sense of ‘flow’,
Bourdieu noted that such intermediaries are also acutely aware of important social
divisions. Engaging with the work of Bourdieu, Keith Negus (1999) writes that:
Bourdieu has argued that the cultural intermediaries who work in artistic production do not gain
their positions as a result of formal qualifications, nor are they promoted through a bureaucratic
occupational meritocracy. Instead, admission and advancement is acquired by exerting influence
within class-divided networks of connections gained through shared life experiences formed among
members of distinct social groups. (Negus, 1999: 18)
Although Negus’s work is now dated due to its focus on major record labels, which
are decreasing in terms of industrial significance and influence, he does note that
Bourdieu has highlighted how artistic work is realized across a broad series of intersecting
social ‘fields’ and not simply within one organization. This is useful for a consideration
of the role of the artist manager as a ‘cultural intermediary’ because they are the only
industrial practitioners who work across such intersecting social fields, or in other words,
across the ‘spokes of the wheel’ that forms the artist’s career.
Windowing and Pricing
Radiohead’s use of different formats for the dissemination of their recorded music is not
only more reflective of the artistically creative process, it is reminiscent of the way in which
film studios have learned that ‘windowing’ is beneficial (Kusek and Leonhard, 2005: 84).
‘Windowing’ means that the same film is sent through a release cycle of seven or eight
windows of opportunity, from theatrical to premium channels to DVD to video to cable
television to aeroplane movies to free-to-air television. Bands such as Radiohead are
now employing various models of format expansion and the associated update-andreplacement cycles that are used in software and film businesses. This is a wise move
since it has been more than 20 years since the CD was first introduced and its ‘replacement cycle’ reached its peak in 2000 (Kusek and Leonhard, 2005).
Radiohead have also embraced the fact that the record industry’s pricing model has
been outmoded. According to Kusek and Leonhard (2005), the consumers’ perception is
simply that they get a lot more value when they purchase a DVD or a videogame. They
note that the pricing of music content online should be more flexible so that music can
flow more freely and because selling physical content online is ‘very unlikely to be the
main method of bringing revenue to the coffers of digital music services. Our hunch is
that as much as 50 or 60 percent of the future revenues will come in from selling other
products and services’ (Kusek and Leonhard, 2005: 36). Similarly, Australian artist
manager John Watson notes that:
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 171
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
171
The problem that everyone is identifying is that CD sales are falling faster than digital sales are rising
to replace them. There are a lot of reasons for that but I think one of the main ones is the lack of
differential pricing on iTunes. Instead of charging, say, $5 for the hit and $1 for the more artistic
song that takes a few listens the labels agreed to let them sell everything for the same price regardless of customer demand, which is contrary to the laws of economics! (Watson quoted in Eliezer,
2007: 276)
Watson claims that what this means is that (in Australia) record labels are making
AUS$1.69 one or two times from each album instead of AUS$15 from the sale of an
album and therefore the music business (from a record label perspective) is shifting back
to becoming a business that is concerned more with selling singles and there is a lot less
profit in the business of selling singles, unless the pricing model changes.
Sean Ryan, Real Network’s Vice President of Music Services, said: ‘the only way to
make money with a 99-cent download service is in a mix of services, including subscriptions, downloads, and radio streams. I would not want to only be an online download
store at this point’ (quoted in Kusek and Leonhard, 2005: 124). Similarly, Sony Connect’s
Senior Vice President Jay Samit notes that: ‘the only way to make money with a 99c
download is with corporate support, like McDonalds . . . the highest paid artist for a 99c
download is Visa or another credit card company’ (quoted in Kusek and Leonhard, 2005:
124). Concerning the emergence of the idea that enabled Radiohead to break this mould,
Radiohead co-manager Chris Hufford commented that their pricing idea had been in
gestation for five years since he and Bryce Edge met a friend in the IT business while in
Los Angeles: ‘That’s the way they were distributing software and they were getting lots
of donations . . . It’s good to think the consumer is honest. I think most people are’
(MusicWeek.com, 2007). In terms of the pricing of the disc box and their online order
and shipping facility for it, Edge commented:
It means we can control the price . . . When a CD goes on sale its price is driven by the market
conditions – we can’t control how much Tesco will sell it for, nor can the record companies. Labels
have allowed retail to control them on that, especially the supermarkets, which is really distressing.
I’m not saying that we have come up with a solution, but it seems to have a logic to it . . . We
definitely want to help independent retail. They like vinyl and the band love vinyl, so there are a lot
of things we can do along those lines’. (MusicWeek.com, 2007)
The emergence of new media technologies such as the internet has led to the fragmentation of the media and of the music retail environment. From Watson’s perspective
as an artist manager and label owner there is twice as much media nowadays and twice
as many retail outlets. Therefore the artist’s management, publicist and label have to cover
twice as much in order to make the same amount of public impressions. However, at the
same time major record label staffing has halved and record company budgets have
halved due to price pressure (Watson in Eliezer, 2007: 274). Watson notes that:
You have half the human and financial resources to reach double the targets. That’s a huge gap that
someone needs to fill if new artists are going to break through and older artists are going to continue
to have success. As I see it, smaller labels and management companies have to step up and fill that
void. (Watson in Eliezer, 2007)
In the case of Radiohead, the band and their management team have stepped up
to fill the void that has been created by the fragmentation of the media and retail land-
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 172
172
CONVERGENCE VOL. 15 NO. 2
scape while other companies have addressed this issue in different ways. Epic Records’
Senior Vice President of marketing, Lee Stimmel, notes that ‘it’s hard to break records
these days – it takes a lot more avenues of exposure’ (Hiatt, 2006: 13). Jessica Simpson’s
2006 single ‘A Public Affair’ was released by Epic Records in a managerially creative way.
Firstly there were two videos. There was a large budget clip and another starring
Simpson’s fans who filmed themselves dancing and submitted the footage to Yahoo
music. Epic also issued 500 downloadable customized versions of the song so that fans
could hear their name in the chorus and Epic plastered North American cities with posters
urging passers-by to sample the song by texting a special number (Hiatt, 2006). Similarly,
Madonna’s song ‘Hung Up’ debuted as a ring tone a month before the song was available for sale and Coldplay’s single ‘Speed of Sound’ debuted as a ring tone product placed
in an episode of CSI: Miami. In relation to these examples, influential Australian artist
manager and record label owner Kim Thomas notes that:
All of those examples are of established acts with very large fan bases. So in that context, all those
things like YouTube and MySpace are effective as additional avenues and they can actually use those
. . . I think that for a developing artist on the other hand there are just more steps in a constantly
changing industry. Yes – MySpace and YouTube have delivered new channels through which to get
music and video clips into the market place. However, due to the large volume that is on both of
them, I think that it is a question of how you actually use them. With YouTube for example 1,000,000
clips are going in there a week. It is just unbelievable. So if you want to just flick through it and look
closely there are a lot of clips on YouTube that are just sitting there with 10 people having looked
at them. It’s the same sort of scenario as a band trying to release a CD and get airplay. It’s another
big quagmire of places you can get exposure but I think that what is really important is how you
use it in conjunction with traditional modes of marketing. (Thomas, 2006)
This comment suggests that managerial creativity is in part dictated by the size of the
client’s audience and strategies will differ depending on positioning within the industry.
Filling the Fragmented Gap
In relation to the question concerning what type of company will emerge to fill the gap
in the music industry work force that has been created by the fragmenting impact of new
media technologies on the media and retail sectors, Kusek and Leonhard (2005) cite the
example of the Sanctuary Group in the UK. The Sanctuary Group is a network of
connected companies that address all aspects of and opportunities in the music industry.
Kusek and Leonhard note that it is perhaps the model for the music company of the
future, with 360-degree participation in all of the revenue streams meaningful to artists:
Founded in 1979 as a management company for Iron Maiden, the Sanctuary Group has been on a
financial tear for the past years, expanding revenues from 23 million pounds in 1999 to 152 million
pounds in 2003, all the while being very profitable. And we thought that the music business was in
trouble? (Kusek and Leonhard, 2005: 114)
Radiohead’s new mode of operation fits into this emerging paradigm. While their
songs are still published by Warner/Chappell and they have partnered with different independent record companies in a variety of territories around the world, because they have
moved away from working with a major label, their management company has become
more influential. While major record labels used to be at the top of the music business
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 173
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
173
‘food chain’, Radiohead, along with the Sanctuary Group, management companies like
The Firm, and the International Music Manager’s Forum (IMMF), are now providing the
necessary business connections and frameworks for new business models. Kusek and
Leonhard note that:
The artists’ brands will drive the business, and the win-win-win economics between artist, company
and fan will make the risk more tolerable and the return on investment more predictable. Instead
of betting on a traditional 10-to-1 recording model that relies on huge CD sales from just a few
artists, the now-evolving business model can test-market artists more efficiently, and work on much
lower volumes by spreading the risk across multiple revenue streams and different forms of ‘product‘.
(2005: 136)
The potential conflicts of interest that can arise through having artist management inside
the overall revenue generating engine can be minimized to a certain degree by keeping
the term of the artist’s contract reasonably short and the financial accounting transparent.
The music retail business has developed historically on a different tangent to the live
music industry, with a different view on how money is made and shared. There is a
different network of people working within it, and it has its own conventions, events and
trade shows. Kusek and Leonhard claim that as a result we have two different segments
within the one industry but that this will rapidly be amalgamated in the digital environment (2005: 115). They note that new media technology has long been embraced in the
concert and touring business. The production sectors (lights, sound, multimedia), logistics (booking and accounting, communication), or the marketing of the shows (email,
online tickets, market research) have all seen many cutting edge applications of technology emerge: ‘new services like Boston’s SonicBids (sonicbids.com, n.d.) allow concert
promoters to gauge their target audience in various markets, and thus avoid booking
shows in locations that are less likely to work with any specific act’ (Kusek and Leonhard,
2005: 115). The use of new media technologies in this sector is leading to more accuracy
in terms of access to the market. Such technology is leading to a situation where access
to the music is converging with ownership of it and it also has the potential to converge
with the live performance of the music.
Conclusion
Radiohead have successfully utilized a model of distribution in which marketing and
distribution have become one and the same. Through the use of new media technologies
they have empowered and engaged the consumer not only through initially enabling the
consumers to price the digital download themselves, but by moving away from treating
their albums as a static product and instead engaging the consumer in an ongoing process
of invention and discovery. Since leaving EMI, Radiohead have demonstrated that the
artist is the brand (not the record company) and in the emerging ‘experience economy’,
whoever controls the brand/experience/service has the power (not who controls the
dissemination of the physical product).
Primarily through online social networking, artists’ brands can link to other artists’
brands as the industry moves from a mass-marketing paradigm to a niche marketing one
and it is in this context that the artist manager becomes more powerful and artist
manager-led business models that feature 360-degree participation in all income streams
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 174
174
CONVERGENCE VOL. 15 NO. 2
become more stable and productive. It must be noted at this point however that major
record labels also realize this and are therefore setting up agreements with artists that
are enabling them to participate in all of their artists’ income streams. While the majority
of artist managers have always participated in a 360-degree way, they are traditionally
service providers and the artist or label has retained ownership of the actual copyrights.
The fact that some record labels are trying to work in this way as well is causing tension
between major record labels and organizations such as the International Music Managers’
Forum (IMMF). This is because this push by major labels does not present a new business
model, rather it takes the industry back to its early days when an artist signed to a label
for everything and the labels ‘owned’ the artist’s work and could easily cross-collateralize
loans/advances from any of their artists’ income stream groups.
Some traditional record companies’ plantation-style proposition ‘You Work I Own’ is
an insult to today’s artist (Kusek and Leonhard, 2005: 32) and innovative artist managers
such as Hufford and Edge of Courtyard Management are using their artist’s brand to
leverage deals that are forcing record labels to become service providers like managers
and booking agents have traditionally been. Some more traditional record company deals
are especially insulting because of changes in digital production (the means of recording)
as well as in the light of the way in which digital distribution itself has changed the barriers
for entry into the music business. Courtyard Management’s proposition is that the artists
should retain ownership of their copyrights; Hufford describes record companies as a
‘service industry . . . just like managers, agents and everyone else’ (MusicWeek.com,
2007). Through freeing themselves of a major record label’s concern for what happens
to the copyrights they own, Radiohead have been able to exploit the current ways people
learn about, select, legitimately acquire, and listen to music. Rather than being concerned
that file-sharing is killing the industry, Radiohead’s strategy demonstrates that file-sharing,
an extraordinarily popular activity, is the cheapest form of music marketing there ever
was.
Radiohead have been able to successfully employ a strategy that enables them to
monetize file-sharing. By upgrading and reinventing their product, the band have been
able to engage their fans and by moving away from treating their album as a static
product they have made their marketing and release strategy more reflective of their
artistically creative process. While Radiohead have only been able to achieve this on a
massive scale because they are a product of the old system that revolved around massmarketing, the success of their approach suggests that the industry is in transition. The
fragmentation of media and retail outlets means that it is increasingly difficult to duplicate the success of mega-artists like Madonna (and indeed Radiohead for that matter).
However people make music because they are emotionally and creatively driven to do so
and new technologies mean that more people can record, perform and disseminate their
music than ever before. It now does not cost millions of dollars to successfully launch an
artist’s career, and in the case of Radiohead, it now does not cost millions of dollars to
keep an artist’s brand in the spotlight. Artists just have to be clever and managerially
creative. It has been said of the music industry that the old ship may have to sink before
the new one can launch. Although Radiohead are beneficiaries of the ‘old ship’ they are
at the forefront of a movement that is helping to sink it.
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 175
MORROW: RADIOHEAD’S MANAGERIAL CREATIVITY
175
Notes
1. The word ‘cultural’ is being used here to differentiate between organizations and businesses that are
involved in the dissemination of artistic creativity from those that are not.
2. MP3 files encoded with a lower bit rate will generally play back at a lower quality. This is not something that is readily apparent on tiny iPod earbuds but it is obvious when the compressed music files
are played on high-end home stereos.
References
Adorno, T. (1989) ‘On Jazz’, Discourse 12(1): 45–69.
Atease.com (n.d.) ‘Radiohead Demanded 10 Million Pound Deal’, URL (consulted 25 February 2008):
http://www.ateaseweb.com/2007/12/28/emi-radiohead-demanded-10-million-deal/
BBC Open News Archive (2007) ‘Fans Crash Radiohead Album Site’, URL (consulted 2 October 2007):
http://news.bbc.co.uk/2/hi/entertainment/7024130.stm
Becker, H. (1976) ‘Art Worlds and Social Types’, in R. Peterson (ed.) The Production of Culture. London:
SAGE.
Bourdieu, P. (1986) Distinction. A Social Critique of the Judgment of Taste. London: Routledge.
Bourdieu, P. (1993) The Field of Cultural Production. Cambridge: Polity.
Brandle, L. (2007) ‘Radiohead Returning to the Road in 2008’, URL (consulted 14 October 2007): http://
www.billboard.com/bbcom/news/article_display.jsp?vnu_content_id=1003660154
Brown, J. (2007) ‘Radiohead Album Goes Live on the Internet’, The Independent, URL (consulted 21
October 2007): http://www.independent.co.uk/arts-entertainment/music/news/radiohead-album-goeslive-on-the-internet-396544.html
Csikszentmihalyi, M. (1996) Creativity: Flow and The Psychology of Discovery and Invention. New York:
Harper Collins.
Eliezer, C. (2007) High Voltage Rock ‘n’ Roll: The Movers and Shakers in the Australian Rock Industry.
London: Omnibus Press.
Frasogna, X. and Hetherington, L. (2004) This Business of Artist Management: A Practical Guide to
Successful Strategies for Career Development in the Music Business for Musicians, Managers, Music
Publishers and Record Companies (4th edn). New York: Watson-Guptill Publications.
Frith, S. (1996) Performing Rites: On the Value of Popular Music. Oxford and New York: Oxford University
Press.
Frith, S. (2001) ‘The Popular Music Industry’, in S. Frith, W. Straw and P. Street (eds) The Cambridge
Companion To Rock and Pop, pp. 26–52. Cambridge: Cambridge University Press.
Gigwise.com (n.d.) URL (consulted 12 October 2007): http://www.Gigwise.com
Hiatt, B (2006) ‘New Ways of Marketing Artists’, Rolling Stone 658 (November): 13.
Hiatt, B. (2007) ‘Radiohead’s Jonny Greenwood on In Rainbows: It’s Fun to Make People Think About
What Music is Worth’, Rolling Stone, URL (consulted 10 November 2007): http://www.
rollingstone.com/rockdaily/index.php/2007/10/10/radioheads-jonny-greenwood-on-in-rainbows-its-funto-make-people-think-about-what-music-is-worth/
Hirsch, P. (1970) The Structure of the Popular Music Industry: The Filtering Process by which records are
Preselected for Public Consumption. Ann Arbor: Michigan, Institute for Social Research, University of
Michigan.
InTheNews.co.uk (2007) ‘60% Bought In Rainbows for Free’, URL (consulted November, 2007):
http://www.inthenews.co.uk/entertainment/music/60-bought-in-rainbows-free-$1162792.htm
InRainbows.com (n.d.) URL (consulted 14 October 2007): http://www.inrainbows.com
Kusek, D. and G. Leonhard (2005) The Future of Music: Manifesto for the Digital Revolution. Boston, MA:
Berklee Press.
Leonhard, G. (2008) Music 2.0: Essays by Gerd Leonhard. Finland: Gerd Leonhard, Creative Commons
License.
Middleton, R. (2001) ‘Pop, Rock and Interpretation’, in S. Frith, W. Straw and P. Street (eds) The Cambridge
Companion To Rock and Pop, pp. 213–25. Cambridge: Cambridge University Press.
MusicWeek.com (2007) ‘Is There Gold at the End of In Rainbows?’, URL (consulted 20 February 2008):
http://www.musicweek.com/story.asp?storycode=1031810
Negus, K. (1999) Music Genres and Corporate Cultures. London and New York: Routledge.
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
161-176 101581 Morrow (D):CON 170x242mm 31/03/2009 15:35 Page 176
176
CONVERGENCE VOL. 15 NO. 2
NME.com (2007a) ‘Radiohead’s In Rainbows to be Released on CD This Year’, URL (consulted 8 November
2007): http://www.nme.com/news/radiohead/32393
NME.com (2007b) ‘Radiohead New Album: What YOU are Paying for the Record’, URL (consulted
8 November 2007): http://www.nme.com/news/radiohead/31506
Peterson, R. (1976) ‘The Production of Culture: A Prolegomenon’, in R. Peterson (ed.) The Production of
Culture, pp. 7–22. London: SAGE.
Pine, J. and Gilmore, J. (1999) The Experience Economy: Work is Theatre and Every Business a Stage.
Boston, MA: Harvard Business School Press.
Sherwin, A. (2007) ‘How Much is Radiohead’s Online Album Worth? Nothing At All, Say a Third of Fans’,
The Times, URL (consulted 13 October 2007): http://entertainment.timesonline.co.uk/tol/arts_and_
entertainment/music/article2633798.ece
sonicbids.com (n.d.) URL (consulted January 2009): www.sonicbids.com
Thomas, K. (2006) Interview with Guy Morrow (4 June).
Thompson, M. (2007) ‘Thom York: In Rainbows Download was Obvious’, Twisted Ear, URL (consulted 26
February 2008): http://www.twistedear.com/index.php?option=com_content&task=view&id=1410
&Itemid=33
Watson, J. (2002) ‘What is a Manager?’, in M. McMartin, S. Eliezer and S. Quintrell (eds) The Music
Manager’s Manual, pp. 1–11. Sydney: The Music Manager’s Forum Australia.
Welsh, K. (2007) Interview with Guy Morrow (2 May).
Guy Morrow lecturer in music business, artist management and music theory at
Macquarie University in Sydney, Australia. His doctorate concerned artist management practices in the Australian popular music industry. He has published widely in
this field and is the current managing director of MQ Productions, Guy Morrow
Management Pty Ltd and Cuthbert & the Night Walkers Management Pty Ltd.
Address Department of Contemporary Music Studies, Macquarie University, NSW
2109, Australia. [email: Guy.morrow@mq.edu.au]
Downloaded from http://con.sagepub.com at Macquarie University Library on September 27, 2009
View publication stats