Here’s why the latest gift to NIN fans means something to all you web professionals out there.

There’s more than one way to profit from your work, even if it seems like the only route goes through one place, be it a monolithic music label or other type of company structure, small or large. For Reznor, it will be the fan interest that will translate into solid ticket sales, greater interest in merchandise sales at shows, and even the sale of physical versions of the free digital download of The Slip being made available now.

It’s all about control. The loss leader has been a staple of retailing for years. Look no farther than the phenomenon of Black Friday, the shopping day after Thanksgiving, when retailers vie with each other to get people into their storefronts in the dark of morning. Offers of heavily discounted items from tools to electronics spur shoppers to come inside, where enough of them may buy some other items at their usual margins.

Giving anything away poses a scary prospect to anyone, when it comes to business; we aren’t talking about charitable causes of course, but the items that make up part of the customary operation of the business.

Nine Inch Nails is in a position to give away music, as Reznor has an established and sizable global fan base. Free may be an option for other digital creators even more today than it has been over the past years the Web has been in place. More people have faster than dial-up connections than ever, enabling more of them to participate in such a giveaway.

The investment of goodwill and public relations may pay off well for Reznor. If it brings out more fans to shows, drives more sales of merchandise, with him reaping the profits, label-free, who could argue his free strategy was a bad idea?

No one should leap into free promotions without researching their impact. History is littered with giveaways that didn’t pay off; a notably ill-fated one was an all you can eat crab legs promotion at Red Lobster that cost the CEO her job. But free may be a strong enough loss leader to make other parts of the web enterprise more desirable and profitable to its owners.

Though the online availability of Ghosts may haunt music labels, no one will be chilled by Reznor’s lyrics. The Ghosts four-volume collection contains instrumentals only.

Trent Reznor
(Photo Credit: Wikipedia)

On the Ghosts’ website, Trent Reznor said, “I’ve been considering and wanting to make this kind of record for years, but by its very nature it wouldn’t have made sense until this point. This collection of music is the result of working from a very visual perspective – dressing imagined locations and scenarios with sound and texture; a soundtrack for daydreams.”

“I’m very pleased with the result and the ability to present it directly to you without interference,” he continued.

An instrumental-only work from Nine Inch Nails would have given label executives fits. Mainstream radio simply does not play instrumental works; confusion would reign for the American Idol-addled audiences Clear Channel and Cumulus reach.

However, savvy businessman that he is, Reznor gave fans plenty of of options to enjoy Ghosts. The first nine songs may be obtained for free, along with a 40-page PDF document and a pack of “digital extra” that include wallpapers and icons.

All 36 songs may be purchased in one download for $5. Fans spending $10 on the 2 CD set will receive a download key for Ghosts ahead of the April 8 shipping date.

Where Reznor shows the real potential of the digital marketplace comes with options tailored to the hardcore fans who have been around since Pretty Hate Machine and are willing to spend on more content. $75 combines the 2 CD pack with a DVD and a Blu-ray disc, to be shipped in May.

$300 picks up the $75 goodies, plus “an exclusive four-LP 180 gram vinyl set in a fabric slipcase, and two exclusive limited edition Giclee prints in a luxurious package,” signed by Reznor and limited to 2,500 pieces.

Musicians with an established fan base, or the desire to build the kind of devotion that makes a $300 content offer a viable option, need to look at what Reznor believes he can do without a coterie of major label executives leeching off of his work.

Top label executives should look even closer and think about how they might construct such an approach for their acts, before those musicians decide the Net delivers better chances to connect with and profit from their fanbases.

I say it’s a great interview, and it is — but Trent also says something that I think is pretty dumb: he says that he’s in favour of an Internet tax, in which everyone would pay their service provider $5 extra and that money would then be distributed to artists to compensate them for downloading. He’s not the only one who thinks this would be a good way to solve the problem, either; the Songwriters Association of Canada recently came out in favour of the exact same thing: i.e, a tax on ISPs.

This idea is appealing primarily because it seems so simple. In reality, however, it would be horrendously complicated to administer, on top of being wrong. Why is it wrong? Because imposing a tax on a broad range of people for the behaviour of a small percentage isn’t just unfair, it’s bad policy and in most cases doesn’t work (and please don’t compare this to the taxes I pay to provide medical care to smokers or whatever; that’s life and death, and this isn’t).

Why should everyone who uses the Internet — even those who just use it to get their email once a week, or to send a web link to their bridge club, or better yet to legally download songs from iTunes — have to pay a fee to compensate artists for the fact that less than 10 per cent of Internet users commit copyright infringement on a semi-regular basis? It makes no sense at all, despite how appealing it seems at first glance.

I sympathize with Trent, and with other artists who are struggling to find a way to adapt as traditional business models fall apart around them, but coming up with new taxes is the wrong solution.

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