Today, I received a press release with the grandiose title “New Music Industry Business Model Launches.” It came from a startup called INDIEBURN.com. This company offers musicians digital distribution through their Web site if you agree to let them set the price at $8 for a full album, then take 50% of the sale proceeds.
Compare this with CD Baby, a reputable online store that has been selling CDs from independent artists since 1997. They offer an online distribution deal where they’ll place your songs into online music stores that people have actually heard of, such as Apple’s iTunes Music Store and Microsoft’s MSN Music. The music store generally takes 35%; CDBaby takes 9% of what’s left over. So the musician gets (slightly) more money–about $5.91 for a $10 full-lenth, vs. $4 with INDIEBURN, plus exposure on lots of highly-trafficked Web sites.
CDBaby’s the best deal I’ve seen, but there are others, like the Digital On-Ramp from Digital MusicWorks International, which offers distribution to the major stores for a 15% cut (after the music store’s cut), plus unspecified per-download fees. (DMI also has a virtual digital record label complete with promotional budget, but that’s a different side of the business.)
I e-mailed the INDIEBURN people for more information, and they claim their small size and lack of exclusivity are the main benefits. I don’t understand the first point–wouldn’t you rather be searchable on a huge, heavily trafficked music site like iTunes than buried away on a site with a bunch of other obscure bands? But maybe if they get some promotional budget and create a kick-ass site, it’ll have its own buzz. And I like the fact that they don’t make you sign an exclusive contract.
Then again, any band with any sort of following at all can build (or hire somebody to build) a Web site, then sell downloads (or whole CDs) for whatever price they choose. If you like a particular band, are you more likely to run a Google search for their Web site and see what they have to offer, or turn to some obscuro online music store?