Sunday, February 17, 2008

Mars Volta joins a growing number of recording artists

Instead of a CD or digital version of the Universal album,
fans could buy a $30 USB drive designed like a Ouija board
planchette. The device comes with a
digital-rights-management-free version of the album and the
promise of more bonus materials in coming months. Users simply
plug it into their computer's USB drive and then listen to the
album or download it into their music library.

The Mars Volta joins a growing number of recording artists
who have experimented with USB releases in recent months, among
them Jennifer Lopez, Ringo Starr and Matchbox Twenty.

More are expected in coming months. Austin-based All
Access, the company behind USB releases from Matchbox Twenty
and Starr, has signed deals with EMI, Warner Music Group and
Universal Music Group to make USB bracelets for other artists.

HIGHER MANUFACTURING COSTS

At this point, the releases are offered more as
collectibles to build fan loyalty than as sources of revenue.

The cost of putting an album out on a USB drive is pricier
than releasing it on a CD, partly because bands aren't placing
bulk orders and partly because flash drives cost more than
discs. Guggenheim said that bracelets generally cost $5 to $7
per unit. But costs can rise to $17 per unit or more for flash
drives with more memory and other additions.

Universal doesn't expect to make money on the 2,000 USB
units it put out for the Mars Volta release or on the 2,000 USB
units it will put out for Erykah Badu's February 26 release,
"Nu AmErykah," Universal senior vice president of digital
business development Cameo Carlson said.

But it does expect to keep fans connected to both acts.
Those who buy the Mars Volta USB stick get a new extra on the
29th of each month, ranging from bonus tracks to wallpaper.
Badu will create new bonus features throughout the year for
those who buy "Nu AmErykah" on USB.

"It's not for everybody," Carlson said. "It's for the
hardcore fan that wants tons of pictures, who really wants
something more and the opportunity to get new stuff every
month."

For bands, USB drives offer a cooler way to get their music
to fans in a souvenir package that fans can wear or carry with
them, giving the band free promotion.

Starr wore a wristband containing his latest album,
"Liverpool 8," to the Grammy Awards, getting attention for the
release that a CD jewel case certainly wouldn't. Guggenheim
said that about one wristband is sold for every three CDs of
Starr's album.

In October, Matchbox Twenty released its latest album,
"Exile on Mainstream," on USB bracelets, putting out an initial
25,000 units. Manager Michael Lippman said that "tens of
thousands" have been sold.

ROOM FOR EXTRAS

"USB is going to be the future," Lippman said. "You don't
have to download it on a computer, you put it in and it comes
up, (and) there's plenty of room to add additional material."

Some indie bands have turned to USB drives for releases
because they can order fewer units and spend less money than
they would for an order of 1,000 CDs, said Ed Donnelly,
president of Los Angeles-based Aderra, which makes drives for
Barenaked Ladies, Jars of Clay and indie bands like Los
Angeles' Killola. Acts can place orders for as few as 100 USB
drives preloaded with their album and other goodies.

Along with the songs from the album, Matchbox Twenty
included its first video, behind-the-scenes footage, pictures
and an Internet link to the band's site.


Based on the success of its album sales on USB, the band is
selling bracelets of its live show at concerts during its
current tour. All Access replicates the bracelets after a
concert in minutes. The bracelets are quickly sent to the
merchandising booths, where fans can buy a recording of the
show they just saw as they leave. Each bracelet costs the same
as one of the band's concert T-shirts.


Barenaked Ladies, considered the pioneers of USB releases,
put out "Barenaked on a Stick" in 2005, a 128 MB flash drive
loaded with 29 previously released songs plus videos and other
content. The band followed it up with souvenir flash drives at
its 2006 concerts in support of "Barenaked Ladies Are Me." The
concert USB keys came loaded with the new album, live tracks,
ringtones and videos for $25.

Willie Nelson, Jars of Clay and the Black Crowes also have
sold USB bracelets at concerts.


Bands typically sell the drives to 5 percent of their
audience at a show, depending on how tech-savvy the crowd is.

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