This model can be described as giving away your songs and then charging for a premium service.

The term was coined by Fred Wilson while describing the new models of several start-up (at the time) companies. This model has manifested itself in several ways in the music business. Both Radiohead and Trent Reznor have recently used this model with success.

Bands who use this model release free songs through their site or other sites and charge for additional content. This ‘premium’ content is only available to people who pay, so the band covers any overhead incurred in production. Further, those who do pay are the SuperFans of the group.

The free content brings value also, although not in monetary terms. Fans download the music for free and send it to their friends, increasing the size of the fan base. The idea is that those fans will convert to SuperFans later.

The premium content doesn’t have to be more music. It could be photographs, lyric sheets, autographed pictures, and physical copies (CD, DVD) of the material. There are many forms of content to be considered for the premium package.

I’m a fan of this method. It creates value for everyone involved and it is easy for most bands to try. You are also segmenting your customer base in such a way that you know which ones will trade money for your material and which ones won’t (or haven’t yet).

And, from a marketer’s standpoint, that is very important information to have.

Person Fred Wilson

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