Last Sunday night I happened to be reading the eMusic message boards when I saw a new post announcing the availability on eMusic of the new album Kala from M.I.A. The original announcement was quickly followed by those ominous words familiar to all eMusic regulars:
get it while you can. I followed the advice, quickly downloaded the album, and the next morning woke up to read the latest comment on the topic:
And, now it’s gone. In this case it’s not really gone from eMusic completely, it’s just
unavailable for download in your country (another phrase dreaded by eMusicians).
So what, right? The album was supposed to be released only to eMusic Europe and/or eMusic UK due to distribution restrictions, someone at eMusic messed up, and it got released for eMusic US before someone noticed the error and corrected it. As everyone familar with eMusic knows, it happens all the time.
Which makes me put on my tin-foil hat and wonder: is it an accident that
it happens all the time, or is it somehow in eMusic’s interest that this occurs on a regular basis? I don’t necessarily mean that eMusic is deliberately making releases temporarily available in countries when and where it’s not supposed to. It might also be that this
accidental release syndrome (as I’ll call it, or
ARS for short) has enough benefits to eMusic that it’s not worth making the effort to absolutely prevent it from happening. (For example, by having eMusic staffers double- and triple-check each and every release before it goes live on each of the eMusic sites.)
Consider: As I previously wrote, one good way for labels to view eMusic is as a way to identify price-sensitive buyers and sell to them at prices they are willing to pay. Ideally this produces extra revenue and profits the labels would not otherwise see, because in the absence of eMusic the price-sensitive buyers would either stay out of the market or turn to P2P. (We’re of course assuming that labels aren’t losing money on each sale due to per-track fixed costs that exceed the eMusic per-track payout. If that’s not the case then labels shouldn’t be selling on eMusic.) In this sense eMusic is the digital music equivalent of Filene’s Basement.
eMusic’s chronic case of ARS no doubt pisses some subscribers off but arguably also advances the strategy of price discriminating based on price sensitivity. First, to take advantage of ARS-affected releases you have to be reading the eMusic message message boards on an regular basis—really daily or even multiple times a day. This restricts accidental release availability to a very small proportion of hard core eMusic subscribers, who are probably also the most price-sensitive of eMusic’s customers. (You know, the people who are on Connoisseur plans and obsess about finding one-track albums to use that very last download.) So task one is done: we’ve identified our price-sensitive customers.
Second, product scarcity (including artificially-induced scarcity) is well-known to be a driver of sales. (For example, it’s one of Robert Cialdini’s Arular, which I’d previously ignored.) As noted in the message board thread, some subscribers apparently bought booster pack downloads for the occasion—a pretty expensive proposition in eMusic terms, at $0.40-0.60 per track or $4.80-7.20 for the entire album. It’s possible that this ARS event bumped the album’s sales up across all eMusic sites, including the UK and European sites as well as the US sites, as even casual M.I.A. fans hurried to download the album before it might disappear; it may have increased sales of M.I.A.’s previous releases on eMusic as well, as in my case. So task two accomplished: getting the price-sensitive buyers to open their wallets and buy something.
(Before I go on, there’s an interesting question here: What happens to the revenues for tracks that are accidentally released in a geographical area without authorization from the label holding distribution rights in that area, including cases where the label in question may not have an existing relationship with eMusic? Perhaps eMusic sends an apology along with a check for the amount that would have been due the label, with an implicit or explicit message
Hey, if you sold through eMusic here’s the sort of money you could be making? Recall also that before eMusic UK and eMusic Europe opened eMusic did in fact sell to subscribers in those areas, without necessarily having authorization to do so from the labels holding distribution rights for those areas, labels which might be different than the labels holding the rights in the US. I don’t recall ever seeing anything about how eMusic handled this; perhaps it treated all revenues as coming from US sales no matter the subscriber location?)
Given the potential for accidental release syndrome to goose eMusic sales, I’m wondering whether it would make sense for eMusic to make more use of artificial scarcity in its sales strategy. In particular, in my previously-referenced post on optimizing sales through eMusic I discussed a possible product versioning strategy in which eMusic would make new releases available only to a certain group of customers, with other customers able to download the releases some number of months later. Why not carry that to an extreme, and arrange with labels to do special
n days only sales of albums that would otherwise not be released on eMusic at all? eMusic could do such sales events a few days after the release date for other channels like iTunes, and not pre-announce that they’d be occurring. That way price-insensitive customers (including at least some eMusic subscribers who are devoted fans of the artists in question) would likely go ahead and buy the release through non-eMusic channels, resulting in higher per-track payouts to the labels, while eMusic would pick up that group of price-sensitive customers who would rather not buy the album at all than pay iTunes prices for it, at a time when marketing buzz for the release would still be at its height.
If eMusic were in fact to do such
n days only sales then I don’t see any harm with officially announcing them (e.g., on the eMusic home page) at the time they occur; the key is not to pre-announce them (e.g., in the
coming soon… section), because then otherwise-price-insensitive customers might be tempted to wait for availability on eMusic and not pay higher prices elsewhere. Also, when announcing such a sale for a release eMusic should make it clear when the sale ends and the release will no longer be available on eMusic; this would lend urgency to the customer’s decision and make it more likely that fence-sitters will opt to download the release.
Regardless of how they happen, accidental release events (more specifically, those releases that savvy eMusic subscribers apparently believe are accidental, and thus subject to being suddenly terminated without notice) might highlight a way for labels to derive incremental sales through eMusic without committing themselves to making all releases available through eMusic all the time.