Open Source Music Makes Tons Of Money

  

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This past week, the band Nine Inch Nails released a new studio album consisting of 36 tracks on the internet.  He uploaded a torrent of the album to The Pirate Bay as well as other torrent sites, all completely free.

And not just free as in 'free beer', but free as in 'free speech'.  All 36 tracks are liscensed under Creative Commons, the equivalent of open source for media.  All of the tracks can be remixed, modified, or embedded in other media (like videos) all for free, all legally.  

As is often the case with Open Source and CopyLeft license schemes, many wondered if Trent Reznor (Nine Inch Nails frontman) would be able to make any money with this venture. 

Reznor offered a number of ways to procure the album.  One was completely free, via torrent sites.  One was through his web site, free (though that only gave you some of the tracks).  One was through Amazon.com, which offered a DRM-free version of the album in high-quality mp3 for $5.  You also had the options of buying a physical 2-disc set of the album for $10, a "deluxe" version with a book for $75, and a "limited edition deluxe" version with two books for $300.

Only 2,500 copies of the $300 edition were made, and they sold out within a few days.  That's $750,000 right there, not including the album downloads, $10 album purchases, or $75 album purchases.

This seems to be a pretty clear indication of just how effectively you can make money while still giving a product away for free and encouraging people to share it, modify it, and redistribute it.

It's also worth mentioning that when you look at the Amazon.com music store's list of Bestselling albums, this album is currently on top.