1) There's a time and place to charge for your music. When you're just starting out, your music is worth nothing because no one knows who you are. If you charge for it, all you do is limit the number of people who might otherwise hear what you have to offer, thereby stunting your career growth. There may come a point in time where you can charge for it, but if you're in DIY mode then that time certainly isn't now.
2) Most people don't value music anymore. There's been study after study all over the world that all come to the conclusion that the biggest demo for music consumption (teens to about 30 years old) all feel that music should be free. How are you going to compete with that? Certainly not by trying to charge for something that people don't feel they should pay for. You can rail all you want about it being unfair (I agree, it is), but you're not going to change this perception by charging for your music.
3) In Music 3.0, the more you give away, the more you sell. It's an interesting phenomena, but time after time it holds true. The more you give it away digitally, the more you sell both physically and digitally. Artist after artist has found that as soon as they take the free tracks down from their website, their iTunes sales go down. In a related field, the recent "children's book" Go The F#&k To Sleep received tremendous pre-orders only after a pdf of the book went viral. I can't tell you what the psychology is behind this as I haven't seen a paper on it yet, but it definitely exists. Ignore it at your own peril.
4) Most music is priced wrong. $0.99 has become the de facto standard for a digital music single, and $10 seems to be what artists want to sell their CDs for, but these price points set up a psychological barrier to purchase. If music was priced better (as in cheaper), perhaps that psychological roadblock can be breached. Of course, we'd have to lower the transaction costs with a new micropayments system (see my earlier posts about this), but at least we'd reach a point where people might be willing to pay something.
By the way, Radiohead has shown everyone the way with their 2007 In Rainbows experiment where they asked their fans to pay what they wanted. It turns out that the average fan paid $6.84 and the band ended up making more money than they ever thought possible, far exceeding their recording costs. Then when the CD was released it immediately went triple platinum (sales of 3 million). I'd say that worked out pretty well.
5) The big money isn't in music anyway. Not directly, because from the beginning of modern music, 90+% of a major or minor recording artists income has come from touring and merchandise. The music is your marketing to get people to come and see you. If you're smart, you'll figure out some packages combined with your music to sell to your fans (you do have fans, right?), and you'll have a number of clever merch items with great graphics. That's where the real money is.
So remember, your music is your marketing. It's what makes everything else you do more valuable, but it's not the main product itself. The more it's out there, free or not, the better it is for an artist.
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