Phish to Offer Fans Free Music Downloads
By KEVIN WACK
LIMESTONE, Maine - Phish, the jam band whose open taping policy made it one of the nation's biggest live acts, is again sidestepping the record industry to cash in on the online music revolution.Livephish.com offers a rare service: soundboard-quality downloads of performances within two days of the concert. Fans pay $9.95 for MP3s or $12.95 for a computer file format where no sound quality is lost during compression. In the first four months after the site's launch on New Year's Eve 2002, the service generated $1 million, said Brad Serling, whose company runs the site as a joint venture with the band. "It's beyond our expectations," Serling said. "It's been profitable from day one." Like the Grateful Dead, Phish has always encouraged fans to record their performances. Likewise, their performances vary widely from night to night, and the band has spawned a subculture of hard-core fans who began trading recordings long before Napster. Since Livephish's launch, many of the band's young, digitally adept fans have proven willing to pay for an improved version of what's already available at no cost. Sound quality is better, and fans appreciate the convenience of being able to access the equivalent of three CDs of music just 48 hours after the show. During an end-of-tour festival last weekend that drew an estimated 70,000 fans to the remote town of Limestone, a long line of concertgoers snaked outside a white tent called the House of Live Phish. Fans used Apple iMacs to make their own free CDs from a menu of three or four songs performed at each of the band's concert stops this year. Some burned their CDs, then jumped right back in line. And fans offered rave reviews of the Livephish service. "To release it two days later in soundboard quality is the ultimate treat for a fan," said Brian O'Neal, 28, of Nashua, N.H. "I think that could be the greatest thing a jam band ever did." Eighty percent of each concert's sales at Livephish.com come within a week of the show, according to Serling. "This is totally new," gushed Bret Berman of Boulder, Colo. "And I think a lot of bands are going to start doing it." Some other bands are tapping into the market for their live performances. Pearl Jam has begun releasing CDs of each of its concerts, and New York-based Rockslide sells CDs of live shows by a number of lesser-known bands. The biggest hurdle is likely to be record label resistance, said Josh Bernoff, an analyst at Forrester Research in Cambridge, Mass. Phish has an unusual contract with Elektra Records that gives the band the right to let fans record its live shows. Elektra, owned by AOL Time Warner Inc., gets a share of profits from Livephish.com, according to Serling. Most bands don't have the same bargaining power as Phish, Bernoff said. That means that even bands with devoted followings could have problems duplicating Phish's model. "In most cases the label has basically exclusive rights to sales of recordings by the bands," Bernoff said. "The problem is the label." But he added, "The record business is not doing great. It's doing really, really poorly. ... I think in that environment you're likely to see a fair amount of experimentation." The record industry has begun selling studio tracks on a monthly subscription basis or a la carte at sites like pressplay, MusicNet and iTunes. But they haven't exploited the market for live performances. Maureen Coakley, vice president of publicity for Elektra, said the record label is not looking to launch similar Web sites for other bands. "I think it works in a Phish world," she said. "Phish is so unique." If major labels do enter the market, they probably won't sell concerts in the easily copied MP3 format, as Phish does, Bernoff said. "Phish has the kind of fans who would download these files and pay for them," he said. "It shows an enormous amount of trust in the fan base to put these recordings out there in MP3 format." Phil Leigh, an analyst at Raymond James & Associates in St. Petersburg, Fla., said other bands have the kind of dedicated fans who would pay for concert recordings. But acts with an older fan base, like the Rolling Stones, might have a hard time selling their concerts online, Leigh said. "The Stones probably have a number of fans," he said, "who no more understand how to download a track than a cow comprehends algebra."
