The 80/20 rule - Artists Set Their Own Prices

One of my clients, PassAlong Networks, offers a very robust platform for independent artists called Speakerheart. PassAlong is all about creating new digital media services that empower the connection between artists and their fans (can you tell why they're a client of mine? ;) ). While the major labels are working to figure out what comes next in their evolution, there's a massive, thriving independent music market. PassAlong figured out that this burgeoning indie music community needed a highly effective, easy-to-use method of enabling online commerce for artists through a system enabling direct transactions between fans and artists.

Speakerheart is such a service. It enables artists to upload their own albums and tracks & convert their songs to ringtones; in turn, it allows fans to preview songs (and ultimately music videos), and also to purchase tracks, ringtones, CDs, and merchandise if it's available. Artists can take the Speaker (preview function) and Heart (bookmark function) and transport these functions across the Web via promotional tools known as "Shelves"; these will allow fans to browse the artist's Speakerheart 'shelf' on the artist's web site, a MySpace page, a blog, or wherever HTML is accepted. Another nifty feature (one of my favorites) is that the artist can set their own pricing for a track; no longer are they tied to a 99 cent model where they'll make a few pennies if they're lucky. Now, they can set the pricing higher or lower than 99 cents a track (at their discretion); Speakerheart keeps 25 cents as a transaction fee -- and the rest goes directly in the artist's pocket. This means that artists no longer have to sell millions of copies of a song or CD; since they're keeping the vast majority of the proceeds they can get by quite nicely on smaller volumes. PassAlong is the first company in the space to make variable pricing available for MP3 downloads. Speakerheart offers a big step in the right direction in terms of artist & fan empowerment.