It’s a Business Model!

In the past six months, you guys have used Bandcamp to sell over $1 million USD in music and merch directly to your fans. The pace of those sales is increasing rapidly, and last week we even saw an artist make it to the Billboard charts on the strength of her Bandcamp sales alone. It’s been awesome to witness, and we’re amped to carry right on, full steam ahead, building out new features, honing existing ones, strengthening our infrastructure, and generally making things better and better. Perhaps most importantly though, we want to do so in a way that’s sustainable long-term, and ensures that we’re here supporting musicians far into the future.

So, as long promised over in our FAQ, we’ll soon begin doing a revenue share on Bandcamp sales. Here’s how it will work:

Bandcamp’s share will be 15% of each transaction, dropping to 10% as soon as your all-time sales exceed $5,000 USD.

The revenue share won’t go into effect until early August. Until then, Bandcamp’s share remains zero. We’ve based the percentages on what works for the business and what many of you have already told us feels fair, but there’s still plenty of time for more feedback, so bring it (preferably in the comments below).

The revenue share rate for existing accounts will be based on all your sales to date. That is, we’ll look at your all-time sales and base your rate on that total. This means many of you will start at the 10% rate from day one. Note that we’ve just launched all-time stats, so you can easily see where you stand.

Your rate will be based on sales to your PayPal email address, not your Bandcamp account. In other words, if you’re a label and have five artists all using the same PayPal account, your rate will be calculated by looking at the combined sales of all five of those artists.

The basic service will remain free. Bandcamp only makes money when you make money. We considered building the business around advertising, but…well, OK, we never really considered that. We did consider building it around subscriptions, but under the subscription model, given the option of either developing a feature to increase your sales by 20%, or dinking around with service tiers to try to boost our subscriptions by 20%, we’d have to choose the latter. By building the business on a revenue share, our interests are perfectly aligned with yours: we only succeed when you succeed.

Questions, Answers

How will the revenue share work? We’re still hashing out the exact mechanism, but the money will continue to flow directly from your fans to you. Loads of you have told us how much you like that aspect of the service, so we’re planning to leave it that way. We’ll of course provide an interface for easily viewing all your transactions and the associated share split, and we’ll provide details of how the share will work by the time it goes into effect.

Do these rates include PayPal transaction fees? No, processing fees are separate. Those rates are here, including details of what you can do to minimize them.

How do your rates compare to the alternatives? We aim to give you a clear financial incentive to direct your fans to your Bandcamp-powered site first, so we’ve made our rates far lower than iTunes’, and very competitive with other music distribution sites. We won’t subject you to one of those competitive matrices that’s out of date the moment it’s published, but we certainly encourage you to do some research and compare (but pack your magnifying glass, fine print abounds in the music biz).

I am angry. What should I do? Leave a comment, we’d be happy to consider your feedback. If you are angrier than that, head over to your profile page and click the link that says “permanently delete this account.”

I am happy. What should I do? We’d love to hear from you as well, so please leave your thoughts below.

I desire an inspirational conclusion. What should I do? Read on, because we want to thank you all again for using Bandcamp. We’re honored to have been entrusted with such an important aspect of your career, and we couldn’t be more excited to keep cranking away on Bandcamp for a long time to come!

Update July 21st, 2010

Lots of great feedback in the comments, thanks everybody! A few thoughts, tweaks and clarifications in response:

Several of you suggested that new accounts should get their first $x in sales rev-share-free. We’re looking at the business impact of doing so, but also mulling over the fact that the cost of trying out the system is already $0 (no setup or listing fees, no charges for streaming or storage, every account comes with free download codes, etc.).

Some felt that the lower rev-share for high volume sellers was unfair to the little guy. We see your point, and may offer a Pro service option to high volume sellers instead. If you think you might fall into that category, please get in touch — we’d love your help defining what that option could look like.

For physical items, the revenue share will apply to the base price of the item only. It will not apply to shipping or tax.

While we’re still in the rev share’s early days, the rate on physical items will be discounted to 10%. It will eventually be the same 15% share as digital, but we want to get a few more of our e-commerce features done first. A few people wondered why there would be a revenue share on physical at all. The short answer is that Bandcamp is a music retailer. We believe that listening to music is critical to selling music, and the infrastructure to support that (web servers, bandwidth, actual customer care, etc.) is factored into our costs. Furthermore, we’ve already invested in a boatload of features to help you sell your music, features like download formats, sharing tools, stats, chart reporting, mobile goodness, download and discount codes, pricing flexibility, merch management…the list goes on. We of course plan to keep on developing the product in response to your feedback, and the cost of all that development doesn’t vary between physical and digital. If you don’t care about any of those features, if all you’re looking for is a place to host an image and a link to PayPal, there are definitely other services out there that would be a better fit. For the rest of you, keep telling us how you’d like to see the service improve, and we’ll keep improving it.

One or two people wondered whether they’d still be able to use the site to give away music for free. Yep, absolutely. Preliminary details on that are here.

There were also some questions about replacing PayPal. We intend to expand our payment options in the future, but we’re still a small (now seven person) company and that feature is getting prioritized along with every other mega-important to-do. In the meantime, our payment success rate (the percentage of people who enter the payment flow and then complete their purchase) already hovers near 70% (and hit 75% yesterday), which is excellent for any e-commerce site.

We’ll undoubtedly be fine-tuning the business model more as we go, so please take it all in the iterative spirit in which it’s presented. Thanks again!

146 Comments

  1. Posted July 14, 2010 at 11:48 am | Permalink

    It’s great to see you guys finding a good business model. I’m happy to share revenue if it keeps Bandcamp going, because the service is the best I’ve ever used.

  2. Posted July 14, 2010 at 11:48 am | Permalink

    It’s about time! Anytime I talk about putting music online to anyone, my #1 suggestion for a home base is Bandcamp, but I’ve always secretly worried about where you guys will go when whatever money you were running off of runs out. It was super convenient that your service was free, but 15% (or less) seems completely reasonable given the services you provide. Best of luck

  3. Posted July 14, 2010 at 11:51 am | Permalink

    Sounds like a great plan. 15% scaling down to 10% is a more than reasonable percentage share to keep an awesome service like this going.

  4. Posted July 14, 2010 at 11:52 am | Permalink

    It’s certainly better than having a bunch of ads on the site. No one has any reason to complain, and everybody should feel lucky that it has gone without profit sharing for as long as it has. This is THE best service of its kind. One thing I would love to see, though, would be full Facebook integration. Is that in the works? Anybody?

  5. Posted July 14, 2010 at 11:52 am | Permalink

    hey,

    you are SO welcome to your 15%. i have been up for paying you from the start. if only everyone we paid a % to worked as hard as you do, we’d be this happy about all of our payments to external services!

    please keep up the fantastic work, you have made what we do considerably easier and more presentable.

    you very much deserve to be paid for it.

    thanks again!

  6. Posted July 14, 2010 at 11:53 am | Permalink

    I like it, but I feel like you should add your own payment service along with this, so I don´t have to go thought Paypal anymore. Because, honestly, I hate Paypal and I would much rather not have to deal with them.
    It would be really nice if you had your own interface, so people buying weren´t sent to Paypal and then back again. That would allow us to give the user a more personal buying experience.

  7. Posted July 14, 2010 at 11:54 am | Permalink

    I’m very happy with this. In the very short time I’ve been using Bandcamp I’ve been very impressed – you guys are really doing everything right. A 15% share for what is arguably shaping up to be the best of all the online distribution services is very fair indeed, even generous considering the cut that others take. Good luck to all of us!

    -Miles

    http://www.streetlightfarm.com

  8. Posted July 14, 2010 at 11:54 am | Permalink

    I was wondering when you guys would start taking a cut. And honestly, I’m totally cool with it. Bandcamp is an amazing service, and I’m more than happy to give a little bit of each album sale to ensure it’s continued existence and growth.

  9. Posted July 14, 2010 at 11:56 am | Permalink

    If its all in the name of keeping what makes Bandcamp fantastic, then I support it. Bandcamp is easily the best platform for digital music, and I want to see the platform evolve and florish.

  10. Posted July 14, 2010 at 11:56 am | Permalink

    I think it’s a perfectly fair deal. Many of us have waited for you to take a step like this, since we want a service like this to continue.

  11. Dwayne
    Posted July 14, 2010 at 11:57 am | Permalink

    Is it possible to provide a specific example. Let’s say I’m selling a song for $1 – how would this all break down?

    Thank you guys for your terrific site and service. Keep up the good work.

    Blessings;
    Dwayne

  12. Posted July 14, 2010 at 11:57 am | Permalink

    Have you guys considered a lower threshold for revenue sharing? Like “We won’t take anything out of the first $500, then start taking 15% after that, and drop back to 10% after $5k”. The “it’ll probably be free for a while still” model is a good one for starving indie artists, and a notion of “it’s totally free up front” would help keep attracting people, I think. Costs nothing to get established, but the ones that start making actual money start paying actual money.

  13. Posted July 14, 2010 at 11:57 am | Permalink

    I’ve been setting up a bandcamp site for Birds & Batteries, getting excited, and thinking to myself “this service is absolutely worth paying for.” Happy to support it.

  14. Posted July 14, 2010 at 11:58 am | Permalink

    I suppose this means I have to change my prices… Otherwise, Since I hardly get any sales… When I DO – I’m going to be losing a chunk to Bandcamp.

    Now I just need to figure out how to calculate that out…

  15. Posted July 14, 2010 at 11:59 am | Permalink

    Hey…Wait Wait Wait…

    So If I sell an Album for 20$…and Bandcamp takes 15% of that 20$…

    I only recieve 3$ ???

  16. Dwayne
    Posted July 14, 2010 at 12:00 pm | Permalink

    @ Huepow (Dr Ear) I hope you’re a better musician than you are a mathematician :) You sell an album for $20 and BandCamp take 15% – BandCamp’s share would be $3 leaving you with $17 minus PayPal’s cut of course which would be 2.9% + 30cents making it – I believe – 88 cents cut more out of your $20 so here’s the low down:

    $20
    – $3 (bandCamp)
    – .88 cents (Paypal)
    _______________________

    $16.22 is your pay (minus stinking state and fed taxes which you are responsible for)

  17. Posted July 14, 2010 at 12:01 pm | Permalink

    You guys are more than welcome to the $3.00 or so that you’d get from my sales :)

    But seriously, this is great. Like the commenter above, I feel like we can breathe a little easier, with the expectation that Bandcamp will be on solid ground for many years to come.

  18. Posted July 14, 2010 at 12:07 pm | Permalink

    I’ll happily share what we make with you, being that you provide by far the best solution on the web for artists to get their music out, and have made it extremely easy and accessible for both the artist to set it up and the user to listen, purchase and share our music. My hat’s off to you for creating this with the artist and listener in mind first as opposed to your wallets. THANK YOU!

  19. Posted July 14, 2010 at 12:08 pm | Permalink

    This is actually very good news. If you’re making money then you’ll (hopefully) stick around. Great service and well worth the percentage you will be getting!

  20. Posted July 14, 2010 at 12:10 pm | Permalink

    How do Bandcamp sales get reported so that they influence the Billboard charts?

  21. Posted July 14, 2010 at 12:12 pm | Permalink

    Details on that here: http://blog.bandcamp.com/2009/06/17/reporting-to-soundscan-this-feature-dedicated-to-the-memory-of-snuggles/

  22. Curtis
    Posted July 14, 2010 at 12:13 pm | Permalink

    I’m fine with sharing revenues at those rates, but then can we remove %100 the BC branding from the bottom of the pages??

  23. Emily
    Posted July 14, 2010 at 12:37 pm | Permalink

    You guys seem really brilliant. What a great business model. Best of luck.

  24. Posted July 14, 2010 at 12:41 pm | Permalink

    fair enough, good to know you’ve got a way of making money
    wouldn’t be making anything much off me at the moment though ;)

  25. Posted July 14, 2010 at 12:47 pm | Permalink

    It’s nice that it’s been free for so long, but I’m even happier that you guys are going to be sticking around for the long haul. I’m more than willing to fork over a percentage.
    You have the most user friendly, artist focused, well designed music site on the internet right now.

    I’m glad to be a part of it.

  26. Posted July 14, 2010 at 12:53 pm | Permalink

    While I understand that you need to make a bit of money on transactions or this great service will cease to exist, I am concerned about what constitutes a transaction on physical products. Do you take your cut on just the base price, or does the shipping cost factor in? If it does, I might have to raise my shipping costs to cover, and I’m not happy with that.

    I also think a 15% cut of physical sales isn’t fair. While selling and delivering downloads consumes your resources, selling and delivering a physical product still relies mostly on my resources. I think a reduced rate on physical sales would be more appropriate.

  27. Posted July 14, 2010 at 12:54 pm | Permalink

    I think this more than justified. You guys have built a great service and it’s good you’re making plans for the future!

  28. Posted July 14, 2010 at 1:02 pm | Permalink

    This is absolutely fair, and like many here. I would much, MUCH rather give up a few cents here and there in sales for such a wonderful and responsive service.

    One question:
    Is “all time sales” on an artist by artist basis? Or, if you have multiple bandcamp accounts does it aggregate for those as well?

  29. Matt
    Posted July 14, 2010 at 1:03 pm | Permalink

    If 15% is the cost of keeping this site around for as long as possible, I will happily pay!

  30. Posted July 14, 2010 at 1:06 pm | Permalink

    It’s about time and I have no problems with this finally happening at all. 15% (+ paypal fees) is a touch high though, in my opinion.

  31. Posted July 14, 2010 at 1:08 pm | Permalink

    I personally would like to see a few things polished though before I’d consider staying. Better uploading that doesn’t go slow as haydes and/or cut off mid stride. Not a big issue if I could resume. This is easy to blame on my connection, but in all fairness its not the problem. A nice queue system for uploading full albums (See last.fm) instead of going through each song over and over. This is hell for labels. Ask my label owner about it.

    Also Paypal needs to be an option but you need to do something else. If you decided to transfer the funds into Paypal afterwards, thats fine, but understand this: Paypal uses an authentication that requires a physical address to match the card source when one is used. This sounds like its meant to be secure but its actually a bane to even some bank’s debit cards(aka mine). Its almost impossible to use a pre-paid or a gift card with Paypal in most cases. This is limiting my customer base. I have to tell them to go to Itunes instead and that defeats the purpose of having your service. As I said I can’t even use my OWN card with Paypal..why do I want to pay YOU to use it?

  32. John James
    Posted July 14, 2010 at 1:28 pm | Permalink

    I agree with “psycliq”s comment…for users who may only make a small number of sales per month, 15% is going to be a much greater burden than users who are making $1000 of dollars…seems a little unfair…of course, FoxNews would claim I’m a secret communist for this kind of talk…I do like his idea of making the first $500 worth of sales free of charge…this would make a HEAP of difference to struggling new bands where every penny counts

  33. Posted July 14, 2010 at 1:37 pm | Permalink

    RIAA Accounting – How Labels Avoid Paying Musicians: http://bit.ly/9Gx5nY

    Thank God Bandcamp isn’t likely to pull this kinda nonsense.

  34. Posted July 14, 2010 at 1:41 pm | Permalink

    Like so many others have said, 15% then 10% seems very fair. Bandcamp is hands-down the best service I’ve used. I love that there are no plans for irritating banners anywhere too.

    The comment for the first $500 sales still free, then 15% sounds like a good idea too. Even if it was a lower amount, say $200, I think you’d draw newer users.
    Although, as it stands, I can’t recommend Bandcamp enough – even at a 15% cut.

    Initially I thought Bandcamp’s own POS service to replace Paypal would be good, but Paypal works very well. Why mess with a good thing?

    I think the last thing any of us want Bandcamp to become is another MySpace – something that tries to do everything, but nothing great.

    That being said, it would be great if Bandcamp had an option (in the banner bar) to link to other sites. Like Tumblr for the blog, YouTube/Vimeo for videos, Flickr for photos, etc. Something that was easy for users who aren’t so great at web programming to use Bandcamp’s header as a central hub to useful sites.

  35. Posted July 14, 2010 at 1:51 pm | Permalink

    How are you going to deal with download codes? you gonna treat them as free, right?

    Also, as mentioned above, I would like to see some entry package for low-volume artists. Like first 50 or 100 sales could be free and then you can charge your fee.

  36. Seamus Anthony
    Posted July 14, 2010 at 2:21 pm | Permalink

    All very fair and deserved. Viva Bandcamp!

  37. soundofjw
    Posted July 14, 2010 at 2:32 pm | Permalink

    I’m entirely okay with this. (:

  38. Posted July 14, 2010 at 2:40 pm | Permalink

    Seems like a totally reasonable fee to me. I’m not sure how it compares to Amie Street, which is the other place I have my music up for sale, but I appreciate that your model will start passing money to the artist immediately rather than waiting to make up your costs first.

    On the other hand, I had 10x as many downloads and listens within 24 hours on Amie Street as I had in a month on Bandcamp. Any plans on building out more on the music discovery front, instead of just browsing by tag?

  39. Posted July 14, 2010 at 2:41 pm | Permalink

    > Any plans on building out more on the music discovery front, instead of just browsing by tag?

    Yep, very high on our to-do list, thanks Dan.

  40. Justin
    Posted July 14, 2010 at 2:51 pm | Permalink

    I’m all for this.

    Personally, I agree with some of the people that would like a bandcamp POS so that we don’t have to go through paypal. That would save your users from giving a chunk of money away to both bandcamp AND paypal. I don’t mind giving a cut to bandcamp as it’s well deserved but paypal pretty much sucks.

    I also think it would be cool of you to not take a percentage out of sales until they exceed a small amount of income such as $100 or so or something. That way it’s still a free service initially and then, once the first larger chunk of money comes in, you start taking a share.

    Other than that, keep up the good work.

  41. Posted July 14, 2010 at 2:53 pm | Permalink

    Seems fair.

    My question: My band intends to use bandcamp only to give away music.

    Do you anticipate a continuing willingness to accommodate people like us?

    Some small yearly fee for our kind would seem fair to me if necessary.

  42. Posted July 14, 2010 at 3:01 pm | Permalink

    I’ll be a dissenter and say that I think it’s too much. Bandcamp does provide a great service and I will continue to use it but I do not plan to keep it as my main personal store. 10%-15% is far too high for a service that is basically one-size-fits-all and requires little labour per artist on your part. If you would make it 5% everyone would be on here and you could overtake iTunes in time. It would make no sense for anyone to operate their own store in that case. I plan to start up my own store now, but I would switch to a Bandcamp competitor that charged a reasonable rate. Take a page from Tunecore – if you have little variable costs, you should not be charging a high percentage. It’s not fair. Even if it’s less unfair than iTunes.

    Also, the earlier comment about physical releases is spot on. You should not be collecting anything for that, although a tiny percentage could be less objectionable.

  43. Manu
    Posted July 14, 2010 at 3:04 pm | Permalink

    I’m happy. I have a bandcamp for my band. My band is so tiny that we have to give away our music in order to be heard. So we are one of those bands that don’t give bandcamp any revenue.
    I’m so happy with bandcamp’s service that I would donate some money if I there was a way to do it. Have you considered letting bands like us making donations as a way of earning some more revenue?

  44. Posted July 14, 2010 at 3:11 pm | Permalink

    15% for me seems just a tad bit high because as a label, we’re not selling very much. Just a few every month.

    And how will this work for artists who use the “Pay-what-you-want” model?

  45. Posted July 14, 2010 at 3:13 pm | Permalink

    Hi Mark, you can sell your music for whatever price you like, or let fans name their price (with whatever minimum you choose), and the revenue share is a percentage of the sale, whatever that may be.

  46. 4eyez
    Posted July 14, 2010 at 3:17 pm | Permalink

    After reading all the comments I agree with two really smart suggestions made by other users:

    -0% under $X sales, 15% over that, 10% after $5000. Not sure what the price point would be. Maybe a trial period, something like that. Either way this encourages new users and gives folks a chance to see whether the system works for them or not without ‘risk’. I guess the worry however would be people making multiple accounts with different paypal accounts thereby taking advantage of the rule.

    -Smaller percentage on physical sales. BIG TIME AGREE WITH THIS. The back end for the digital stuff is AMAZING. The conversion, the players, the embedding. But physical sales do use few of your resources and tons of ours. It almost makes me consider using bandcamp only for digital and have all physical on my site so I can keep the profit margin necessary for physical given the costs of manufacturing. Though, again, I can see how people might take advantage of this: list something as having a physical copy with a note saying you won’t actually receive anything, then people download the release files that ‘attached’ to the physical version.

    I understand the desire for simplicity and avoiding all the ‘policing’ these options would involve, though I’d like to believe people would ultimately be ‘good citizens’ and recognize that such a quality service desires a cut. It would be a serious tip of the hat to consider them.

    Thanks, love the service like everyone else!

  47. Posted July 14, 2010 at 3:17 pm | Permalink

    You know, of course it’s a bummer to an extent but honestly I find Bandcamp to be the most user friendly, clean, easy to use website. No one provides service like you guys do – everything works and everything just makes sense.

    I’ve been a long time promoter and activist for Bandcamp and will continue to be so. Just please don’t ever do the ‘pay more for xxx service’ model. I’m down to give you guys the flat fee but if I have to pay extra for every little thing it becomes too cumbersome and too expensive.

    -Zen

  48. 4eyez
    Posted July 14, 2010 at 3:24 pm | Permalink

    Digits posted while I was writing mine, he makes a valid point too. It’s a high percentage given the limited amount of editing one can do to the layout and how little involvement it is on your end now that your ‘code is written’.

    And I think he’s right, charge a lower percentage and you’ll have a flood of people switch over to BC, iTunes and all that would be useless.

  49. Posted July 14, 2010 at 3:32 pm | Permalink

    15% is absolutely OK by me. It’s much less of the selling price than the distributor/shop makes selling physical CDs even, and i’m happy for you guys to get your cut.

  50. Posted July 14, 2010 at 4:44 pm | Permalink

    First, thanks… you guys deserve a decent business model; given the resources you’ve put into this. It is cool of you to allow us to be part of it.

    I share psycliq’s sentiment:

    “Have you guys considered a lower threshold for revenue sharing?”

    This helps keep art and commerce in balance, which I have found to be a useful aspect of bandcamp so far: Present your art and if the masses come a callin’, sell it and help your benefactors. If the masses don’t come around en-masse, well… at least your art was available to those who appreciate it; without the heavy burden of infrastructure (Thanks bandcamp!)

    I also agree with the strategy of establishing an independebt POS. Perhaps as revenue flows from this change, some could be re-invested in the infrastructure necessary to make an independent POS service happen. Then the entire bandcamp community can share in the benefit of streamlined operations (i.e. no paypal fees) having helped fund the new infrastructure to make it happen.

    Digit’s “dissenting” comments are food for thought… as other models enter the space, bandcamp could already be set for growth by attracting revenue-bearing members via a smaller percentage.

    Off the top of my head the only option that comes to mind that hasn’t been discussed is an option to pass on the fees to the end user… I guess that can be accomplished by setting your price to absorb, but it might be an nice option to allow the buyer the option to help pay ‘administrative costs’.

  51. Chris
    Posted July 14, 2010 at 4:54 pm | Permalink

    No charge for the first $500 of total (digital + physical) sales and 10% thereafter would seem equitable I’d think.

    It’s a fine line between encouraging increased sales (to reach a lower tier) and discouraging use at all.

  52. Jessica M
    Posted July 14, 2010 at 5:10 pm | Permalink

    You guys do a really wonderful job at the whole digital download thing, but I really don’t like the two-tiered pricing along profit lines, where the people that make the most pay a smaller percentage. I’d be much happier if it was just a flat rate, be that 10% or 12% or 15%.

    The points about physical sales are well made too, and I think they warrant a smaller cut than sales that include a digital download.

    Even under the possible exploitation pondered by 4eyez, this would use less of your resources than a proper digital download because the artist would have to provide this functionality themselves. It should be made obvious which purchases come directly from bandcamp and which are provided through the artist, anyway.

    Enable the Customer, Empower the Artist, Conquer the World!

    You’re doing a good job and I hope you can refine your business model as readily as you have improved the rest of your service. :)

  53. JP
    Posted July 14, 2010 at 5:12 pm | Permalink

    Seems like you should have your own payment processing system set-up before asking for this kind of cut in sales… Any plans beyond providing a Paypal link?

  54. Posted July 14, 2010 at 5:25 pm | Permalink

    Don’t ever increase the fee and I think you’re onto a winner here. Bandcamp appears to be the epitome of simplicity. Best of luck :)

  55. Posted July 14, 2010 at 5:38 pm | Permalink

    Mid-august would be when i plan to release my 7 song EP. Just my luck. But you know what I would rather take a percentage cut right now while I’m still becoming more known than pay a yearly fear or something similar in which i’m not sure if I’ll make much. I think the % under X amount is good, then 15% but no big deal. but I do think that for physical things it should be at least less of a percentage.

  56. Posted July 14, 2010 at 6:23 pm | Permalink

    I think comment #16 got it right:) and those that think 15% is too high must think this through (physical sales aside).

    I produce an album at our studio. I plop my big butt down in the studio office and spend a little bit of time producing my BC page, I few more minutes uploading those songs, PayPal takes care of the cash transactions and I didn’t have to move my big butt out of my studio office’s chair. Instant distribution, instant cashier and mass marketing all without having to leave my comfy office! No gas, no talking with venues to see where in the snot I can post a poster. Also, since some of my income derives from website development, I can appreciate the expense, resources, staff that goes into producing something like BandCamp.

    Now granted, I do love that starving musician mentality of not charging until you’ve reached X number of sales dollars. Either way, I’ve enjoyed and promote BandCamp to other bands. Keep up the great work…it’ll all work out!

  57. Posted July 14, 2010 at 6:46 pm | Permalink

    Bandcamp is the greatest tool we have found in the last 5 years. We surely support Bandcamp’s new business model.

    Long live Bandcamp!

  58. Posted July 14, 2010 at 7:02 pm | Permalink

    Why charge the little guys more than the big guys? It’s hard enough getting started as it is – most of us will never reach $5000. 10% flat rate on everybody is my vote, with no charge for generating download codes, and no charge on physical packages that don’t include downloading.

  59. Posted July 14, 2010 at 7:06 pm | Permalink

    will we still be able to give music away for free?

  60. Posted July 14, 2010 at 8:47 pm | Permalink

    I like this model. It sounds and feels fair. I look forward to the future innovations.

  61. Posted July 14, 2010 at 8:56 pm | Permalink

    I love bandcamp. I may not earn you too much money, but you are more than welcome to your %15!

  62. Diddy
    Posted July 14, 2010 at 9:18 pm | Permalink

    Everyone here is cheering for bandcamp saying they’re going to start taking their money. I’d like to know their secret.

    That said, 15% is not reasonable. That is far higher than any online sales site I’ve ever seen. It’s almost twice what iTunes charges. Drop it to 7% and we’ll talk.

  63. Posted July 14, 2010 at 9:20 pm | Permalink

    Diddy, iTunes takes 30%. TuneCore has a good FAQ discussing various services’ rates, here: http://www.tunecore.com/faq#StoresOverview

  64. Posted July 14, 2010 at 10:13 pm | Permalink

    I agree with a couple of comments above regarding the regressive nature of this….Not that I have a problem with the taking a cut concept, but by giving the artist who sell more a discount, your set up is regressive against those who are doing smaller sales numbers. If, instead, you had a flat rate for all somewhere between 10% and 15%, you will, it seems, make as much or more money without having as large an impact on the artists with the smaller income.

  65. Posted July 14, 2010 at 10:14 pm | Permalink

    Ugh.

    I’m not really pissed that you guys are starting to charge a fee, as I understand why you’d want to, but:

    1) I wish you gave more warning. I just moved my entire record label’s catalog to bandcamp out of a store I hosted myself, and I wouldn’t have done so if I knew this was going to happen.

    2) The fee seems steep to me unless you’re offering REAL credit card payment options. Paypal scares off A LOT of customers.

  66. Posted July 14, 2010 at 11:42 pm | Permalink

    i love you guys, and you know that. you guys have done so much for music, and this is peace of mind for me that you guys are going to be able to stick around. thank you! <3

  67. Posted July 14, 2010 at 11:44 pm | Permalink

    I think Bandcamp absolutely deserves to get paid for their work on this awesome site. That’s a given.

    However, and it’s been said already, but I don’t understand why you’ve chosen to penalize new or unknown bands by taking more of their income (15%). That doesn’t make sense to me. It’s not like you’re doing more to upkeep their accounts. We’re all on a level playing field here, right? It should be 10% (or 15%) across the board and leave it at that. Anything else strikes me as unfair.

  68. Posted July 14, 2010 at 11:59 pm | Permalink

    I love Bandcamp, so does everybody and so does Omar Rodriguez-Lopez.

    Yet, I have to agree with some people’s comments and concerns that are well summarized by Comment #42.

    1) 0% cut unless an artist makes $XXX.
    I think some people would feel more ready and more comfortable sharing the sales with Bandcamp once they have sold a certain amount.

    2) smaller % cut for physical sales.
    While we are all happy that now Bandcamp can start making money, and we all know that you worked your butt off to make the physical sales thing possible,
    I think we’ll be happier if it takes a smaller cut from physical sales than download sales.

    But in any case, I love Bandcamp.
    Thank you.

  69. Posted July 15, 2010 at 12:03 am | Permalink

    15% is both fair and profitable. As long as you dont bring in a minimum price. If this works then this is the future of the music industry and its looking very bright.

  70. Rugirl
    Posted July 15, 2010 at 12:31 am | Permalink

    Well I understand everything about business being business. And I do appreciate the quality and all the features of your site.

    What I find sad though is the fact that small time artists will once again end up paying more than big shots.

    Just think about it. Someone just starting up, who is excited about selling even one or two CDs ends up paying a larger percentage on their sales than someone who could actually afford it since they are making a substantial amount of money from the sales. (Plus the PayPal fees as before.)

    Once again. I understand the business side (I have a BA in business so yes I do), but I can’t say that I agree with the human aspect of it.

    I guess I am just more likely to go along with what was called here as the “starving musician mentality”. I believe that not charging artists until sales reach some number X that you guys set would make much more sense. You would still have a large inflow of artists that are starting up and are looking to establish themselves online. And then when they manage to get bigger they stick with you since all the fans already know about the bandcamp page and since it’s an awesome service. So in the end they get the money to start growing and you guys get yours once they are a bit bigger and bringing all the traffic to your site.

  71. Posted July 15, 2010 at 1:04 am | Permalink

    Oh yes, digital downloads you deserve a cut, most definitely. You’re providing a great service.

    Physical goods and postage should be treated differently. No cut, seriously. Zero. If we don’t include a digital download then there should be no charge, since we’re not using your service for that sale. That’s fair.

    And if you’d asked me to guess what percentage Bandcamp would take before the announcement my guess would have been closer to 7.5%. But what do I know?

  72. Posted July 15, 2010 at 1:49 am | Permalink

    Bandcamp have to take a cut – anybody who expects a service as brilliant as this for FREE is out of their fucking minds…the Freemium model appears to be on the wane. Good. I am more than happy to pay for excellent, clear, concise service.

    If the service was pants I’d be off – but it isn’t, it is far away the best distribution model I’ve ever ever used and anybody who uses it SHOULD be giving up a percentage.

    The cult of everything for free is not a sustainable model. Bandcamp would die, bands will die.

    One good thing to have come out the Freemium mess is that a modicum of quality has returned to people’s minds – they will only pay for something if it represents outstanding quality – this is the way it should be, not just blindly accepting crap.

    Bandcamp falls under the banner of a service of outstanding quality; we all need to contribute to keep it and ourselves going.

    Who knows, maybe there will even be a major cultural shift in the majority of the record buying public to buying direct from the artist being seen as the way forward!

    Kudos and keep up the excellent work.

  73. Posted July 15, 2010 at 2:04 am | Permalink

    at 15% nobody offers the same kind of service that bandcamp does. It just makes perfect sense and I’d expect nothing less from them. The support and infrastructure the online sales are built on pays for the 15% without even getting to the love and thought put into the way people can buy our music quickly, securely and in any a range of qualities. BUT the best thing about all of this is bandcamp is giving power back to the musician to sell his music fairly, that in itself is priceless. the balance is thought out the website works, the artist and the bandcamp, win – win. If anybody needs some support about marketing their music and how we get it out there to keep our sales so steady, let me know. happy to help. knowledge is power. Peace CAde… from the Dub Fx Crew!!

  74. Ningoonies
    Posted July 15, 2010 at 2:31 am | Permalink

    I always thought that your business model wouldn’t charge everybody, just those who were makin real money through bandcamp.
    That is the idea you guys gave when i signed and I ask you to reconsider a minimum monthly sum of money before asking for your well deserved pice of the pie.
    Thanks!

  75. Posted July 15, 2010 at 3:18 am | Permalink

    Fair enough, no problem at all. But I would like to echo the concerns of comments 39 and 41: What about bands that don’t generate any revenue for you, or that give away their stuff for free?

  76. Posted July 15, 2010 at 4:10 am | Permalink

    I don’t have a problem with paying for the service but I agree with some points already made. Mainly that 15% for the sale of a physical product is far too much. Bandcamp offers nothing towards that sale.

    I also agree that you should seriously consider cutting PayPal out of the equation. I distrust PayPal immensely and the doubling up of fees starts to make a £1 sale far less attractive to bands than it is at the moment.

    Finally, if I am paying for the service, can I have the option of having my streaming mp3s truncated or static inserted (etc) so people cannot come along and hijack the audio? It’s all very well offering full, free songs but what’s to stop people ripping them? Nothing at all. An option to (for example) insert a static blip ever 30 seconds would keep me here long term. Otherwise I’d consider looking elsewhere.

  77. C M
    Posted July 15, 2010 at 4:32 am | Permalink

    I’m very impressed with Bandcamp, and I think I understand something about the amount of work and costs it take to produce. However, I think 15% is too high. Perhaps it’s ‘competitive with iTunes’, but that doesn’t say much, right? I think that’s higher than CDbaby, even. I’m in agreement with the poster who thought it should be 5%.

    I want to pay Bandcamp for the Bandcamp service, but I don’t want to feel like Bandcamp is making money off of my love and labour. The 15% on physical package sales seems more egregious. 15% seems especially wrong when one considers the future potential of Bandcamp.

    Speaking of future potential, I know that I would appreciate more transparency as far as your business plan is concerned, since we are now ‘partners’. What are Bandcamp’s future growth projections? Who’s funding Bandcamp start-up costs? Not that I’m suspicious or anything. I’d just like to know.

  78. Posted July 15, 2010 at 4:33 am | Permalink

    CM: CDBaby’s fee on digital albums is 25% (plus your setup fee). See http://members.cdbaby.com/whatwedo/sellDownloads.aspx. Thanks for your other comments, we’re considering them.

  79. Greg parmentier
    Posted July 15, 2010 at 5:08 am | Permalink

    Fair enough but do consider the physical sales argument there is a point there

    … Oh and please don’t sell out to an Internet giant

  80. Posted July 15, 2010 at 5:58 am | Permalink

    Words cannot describe how much we love Bandcamp. I am happy to start sharing! Good luck!

  81. Posted July 15, 2010 at 6:00 am | Permalink

    if you are banking 5k or more off of bandcamp then a 15% cut is pretty reasonable if you ask me. Great service and it doesn’t effect us up and comers :)

  82. Posted July 15, 2010 at 6:14 am | Permalink

    It’s great that you guys will take a cut….it really is. You deserve it for the service you’re offering. It would be excellent if you offered a way to deposit the funds directly to bank accounts instead of you guys taking a cut and then paypal taking a cut after that. I’m tired of giving paypal a percentage of the music we make. Any ideas on that.

  83. Posted July 15, 2010 at 6:31 am | Permalink

    I completely agree with comment #42. It is clearly stated, so I’ll just summarize by saying that while I’m a big fan of Bandcamp, I find 15% too steep for a band with less than $1000 in Bandcamp sales and a 15% cut on physical items isn’t cool.

    What about 5% until a band reaches $500-$1000 and 5% on physical items? Just throwin’ around some ideas… You know what would possibly flip my thinking? A label page with a cart option. A cart for physical items would make the cut for physical items more reasonable. Especially if there were a way for the physical items to appear with a picture on the main index page.

    Thanks for creating, maintaining, and expanding such an impressive option for bands. I’m excited to see where Bandcamp is headed…

  84. Derek F.
    Posted July 15, 2010 at 6:42 am | Permalink

    I actually think 15% is way too much. Especially considering Paypal only takes ~2,9% and manages to keep their service going. Yes I realize they have alot more users, but they are also considerably bigger firm with more expenditures (does it matter who owns them or if they were an investment? They still have to be profitable in light of everything and they are). Around 5% flat commission would be fair I think. Why would you want to have a diametrically progressive solution where you actually take more from those who have limited sales than from those who have many. Bandcamp is great and all, but come on. Don’t go corporate on me. ;)

  85. Posted July 15, 2010 at 6:49 am | Permalink

    I am so glad that you guys have set up a sustainable business model that makes sense and is fair all-around!

    I love this site and never want to see it go away.

    I especially love how everything is still free until you start making money which is quite honestly a great way to build loyalty and has completely won me over.

    Thanks and good luck with the business!!

  86. mea
    Posted July 15, 2010 at 7:01 am | Permalink

    Like many others I’d also like to give my compliments for the brilliant service. I like the suggestions that it would remain free for sales under a certain amount, be it even 200-300$. But in any case I will continue using bandcamp. Thanks.

  87. Glyn
    Posted July 15, 2010 at 7:17 am | Permalink

    Some of us on the Cubase forum are interested and enthusiastic about Bandcamp. Some of us have Bandcamp sites. Also http://www.haiti.bandcamp.com has been the distribution hub for a charity we’ve been running since the disaster. Therefore I’ve extended the discussion to:

    http://www.cubase.net/phpbb2/viewtopic.php?p=998794#998794

    As far as I am concerned, giving you 20% up to $5000 and 10% thereafter is perfectly fair, and I am fascinated by the perspectives and suggestions posted in this list of comments.

    I thank you for all that you and your colleagues have been doing.

    Best wishes
    Glyn

  88. Posted July 15, 2010 at 8:13 am | Permalink

    You should really clarify your position on hosting non-sales music. One of the best features of Bandcamp was that it was a professional way to host albums that just needed to get out to people, no money involved. If you’re planning on keeping it free to use for free tracks, that’s great. If not, you should state your intentions.

    While it certainly might be attractive to smaller artists to have some minimum total sales amount under which no percentages are taken, the reality is that hosting all those smaller artists really does incur a significant cost. Allowing them to hang on for free means that the larger players are subsidizing their existence. Keeping the percentages even across all accounts lets everyone pay for their share.

    The only counter argument I can see to the physical package fees are that many of them include digital downloads. It does seem odd that purely physical packages like t-shirts would incur the same fees as digital downloads. I imagine this is done to make up for hosting expenses elsewhere and to discourage gaming the loophole. Some comment on this topic would be enlightening.

  89. Posted July 15, 2010 at 8:14 am | Permalink

    you guys are the BEST.

    no probs.

    also, HOW THE HECK DOES ONE GET ON YOUR PHYSICAL NONLABEL?!

  90. Posted July 15, 2010 at 8:27 am | Permalink

    While nearly everyone here seems to agree some sort of cut for bandcamp seems fair…What about the little guys.

    We’ve had whole album sales go straight to paypal. If we have bandcamp taking a further cut on our meagre sums it will seem like we’re going backwards.

    You are gonna have to do something like someone mentioned earlier and do the first 100 sales for free.

  91. Posted July 15, 2010 at 9:13 am | Permalink

    I entirely support your decision.
    Bandcamp does great work.

  92. Arch Valenz
    Posted July 15, 2010 at 9:56 am | Permalink

    This is bullshit. I boycotted iTunes and practically every other service because of this. Who the hell do you guys think you are taking a cut of musicians music without paying us an advance? You will become the most premier music service this year but I will not be a part anymore. Other independent musicians such as myself should feel the same disgust as I do.

  93. Posted July 15, 2010 at 10:16 am | Permalink

    I’m not likely to see much from my site, however I would like to think that some day I might, I won’t stick around if there are ads creeping in, I would not be against a small yearly subscription to help keep it that way. If ads are coming for non-sellers, then I am out of here.

    I agree with those who say that small volume sellers should perhaps be given the first few sales for free, then the model applies… and also agree that those selling physical items should be given a lower rate.

  94. Posted July 15, 2010 at 10:21 am | Permalink

    The scheme is a big pity for small time artists. I remember reading some time back that the business model planned for the future was rather more radical in that it would be primarily drawing revenue from the top selling artists and leaving all us paupers free. Pity it’s gone the way of every other site in slugging the ones who are making little cash the worst. I still like the site but am disappointed that I have promoted it so hard to small artists and now this.

  95. Michael Pulsford
    Posted July 15, 2010 at 10:30 am | Permalink

    Sounds great. Like commenter #6 above, I’d also be happier if PayPal were eliminated and you had your own in-house payment system, but I’m fine with what you’ve proposed in any case.

  96. Posted July 15, 2010 at 10:44 am | Permalink

    Agreed – 15% on physical sales is a little onerous considering the almost nil resources you use/supply to manage that on BC. 15% of digital is more than fair, given how awesome and simple it is to use the service. Also, making sure the uploader is kink-free has to become a priority… Nothing more frustrating than re-upping tracks….

    Keep up the awesome!

  97. Posted July 15, 2010 at 10:45 am | Permalink

    Fair enough, at least ye haven’t started charging bands whether they make money or not.

  98. Posted July 15, 2010 at 11:40 am | Permalink

    I’m going to venture and say that Arch Valenz is being sarcastic and joking, but if not, then please do go and good riddance. Nothing in life is free. You wont get far with that attitude.

  99. Posted July 15, 2010 at 12:09 pm | Permalink

    Free was great… but 15% is entirely reasonable. It is cheaper then what the crooks over at Amazon want, and I’d much rather support an independent business that is helping small artists like us find an avenue to release and distribute our music in an easy and effective format. I will gladly give you my 15%… its not a lot of money, but I hope it will help the wonderful entity that is bandcamp grow. thank you.

    …but don’t raise it past that! :)

  100. Posted July 15, 2010 at 1:02 pm | Permalink

    Thanks for the comments everybody, we hear you and are mulling what seem to be the recurring themes.

    About PayPal (@justin, @dan, @michael, @claire, @JP, @Tony): it’s a fairly common misconception that if a service only implemented its own payments system, PayPal fees would disappear and there would be more money to go around for everyone. The reality, however, is that payment processing fees are unavoidable. That’s why Google Checkout, Amazon Payments and even a super hip, they-clearly-get-it payments 2.0 company like Braintree all have similar fees to PayPal’s. We still might take credit cards on our end in the future, but it’s hardly the panacea that some people are hoping for. Also, our payment success rate (the percentage of people who enter the payment flow and then complete their purchase) already hovers near 70%, which is considered very good by the sorts of people who track such things. Finally, don’t forget that Bandcamp accepting credit cards means the money no longer flowing directly to the artist, which is something we know many of you love about the way things work now.

  101. dudewithsomemusic
    Posted July 15, 2010 at 1:18 pm | Permalink

    15% is the industry standard for a starting rate. That’s seems very reasonable. Digital distribution will cost you that much unless you’ve got some incentive to get it lower – like a 5000 song catalog.

    My only question has been asked already. But at this point I can only assume that since “we make money if you make money”, we can still give free downloads.

  102. Posted July 15, 2010 at 2:40 pm | Permalink

    @john, dudewithsomemusic, elbybrass and yintan:

    > My band intends to use Bandcamp only to give away music. Do you anticipate a continuing willingness to accommodate people like us?

    We think free downloads have a real place in the big picture of a band’s career, so yes, definitely. However, some artists have used Bandcamp to give away hundreds of thousands of album downloads. That’s fabulous and we want to support it, but of course there are real costs associated with doing so, and continuing to do it for free would have a negative impact on those selling their music, or giving their music away in more typical quantities. So in about a month we plan to give every account a good number of free downloads, beyond which you’ll be able to purchase more. This isn’t an area where we expect to make money, we’re just making sure we cover our costs.

  103. Ben
    Posted July 15, 2010 at 3:07 pm | Permalink

    I think the move is extremely fair, and will continue to use Bandcamp for my direct-to-fan campaign. I think it’s high time they get something back for running and maintaining such an easy to use, not to mention highly pofitable, site where artists like me can bring their product to their fans directly. They also LISTEN. That’s key to maintaining any successful venture. They listen to what people want. GO BANDCAMP!!

  104. Posted July 15, 2010 at 4:09 pm | Permalink

    Bandcamp: I love you. Your services have been fantastic and are completely worth paying for. Text is a strange medium so please know there’s no snarkiness or attitude behind my thoughts and questions.

    Would it be possible to offer an annual flat fee alongside the percentages and let us choose? That way if we don’t make the money to cover the cost of the annual fee that’s our choice and we have to live with it. You gave us an option and we chose poorly. Not your fault and you can sleep with a clear conscience.

    I’m looking at this from a place where I actually have made some money and to do the 15% (then to 10%) wouldn’t be the most ideal financial option.

    For example, my cheapest option (READ: Not the best option) would be to go with Nimbit. They offer very similar services and they offer them with an annual fee (only). They also aren’t nearly as sexy or easy to use so there’s some give and take.

    TopSpin is so exclusive that I have no clue what goes in their tree house.

    Also, if there was an option to create sub-stores (i.e. T-Shirts, Vinyl, etc) that would make things WAY more appealing.

    Thanks for your services. You’ve done a lot for me and I want to stay but part of being a musician in this DIY climate is managing your finances responsibly.

  105. Posted July 15, 2010 at 4:25 pm | Permalink

    > they offer very similar services and they offer them with an annual fee (only).

    I believe Nimbit’s fee is actually 20%. Search for the text “80%” on this page: http://www.nimbit.com/plans-pricing/

    Thanks for the other great feedback Jon, adding to the mull pile!

  106. Posted July 15, 2010 at 4:34 pm | Permalink

    @Ethan Diamond

    Oh man… Fine print will get you every time. Thanks for pointing that out.

    Thanks for the quick response and the open-mind.

    I’m also aware that I’m in a unique place (a 5 EP project over the year) and in a weird middle tier where I’m having small success but enough for the 15% to affect me.

    Thanks for understanding.

  107. Thelemic Laboratory
    Posted July 15, 2010 at 4:58 pm | Permalink

    I agree. Snot bad really. Cool site. Still hate Paypal though.

  108. Trevor
    Posted July 15, 2010 at 4:59 pm | Permalink

    Go Bandcamp!!! Go! Go! Go! (also, I like the idea of a integrated POS

  109. Posted July 15, 2010 at 6:37 pm | Permalink

    Fair enough, I accept your terms.

    I still would like to make zip code an optional item for form validation.

  110. Posted July 15, 2010 at 6:45 pm | Permalink

    also, you had me at ‘custom domain’…

  111. Posted July 15, 2010 at 7:53 pm | Permalink

    I’ve only being using bandcamp for the last two days and I love the tone of the communication, whoever is writing these blogs and running this company is awesome at talking with musicians not talking down to struggling musicians.

    Kudos. I don’t mind giving 15%, though 10% sounds better off the bat.

  112. Posted July 15, 2010 at 8:50 pm | Permalink

    A 15% increase is fucking insane.

    I’ve turned on soooo many artists to this service and telling them “It’s FREE!”, which is what made it great.

    Now it is far less great. The tiny amount of money some of us small artists make just got way smaller.

  113. Srijan Deshpande
    Posted July 15, 2010 at 9:02 pm | Permalink

    This sounds fine. 15% seems reasonable. I’m a little confused about how this will work with paypal, though. Will the paypal fees be calculated after deducting the bandcamp fees, or vice versa, or on the total amount of the transaction?
    Thanks for the awesome work!
    -Srijan

  114. Nicolas
    Posted July 15, 2010 at 11:21 pm | Permalink

    I must agree with Jared Ringold. Taking a share on physical products is tricky cause the delivery isn’t processed on your side. I think a low rate as Paypal’s cut (say 3% or 5%)could be reasonable. You could also fix the share according on the number of releases. 1 release: 3%, 2 releases: 5%, 3 releases 10% etc… In other words, more you use the shop system, more you increase the share. Makes sense?

    In terms of digital sells, 15% is very welcome.

    You guys are doing awesome work! Thanks so much. :)

    Take care,
    Nicolas

  115. Posted July 16, 2010 at 1:30 am | Permalink

    I have been anxious for a while about Bandcamp’s promise that “For now it is free but in the future it won’t” and then with this announcement I breathed a sigh of relief, as most of my music released is for free, and if I were making money selling music I’d be happy to give you guys a cut. However after reading all of these responses my heart lurches as I read “So in about a month we plan to give every account a good number of free downloads, beyond which you’ll be able to purchase more. This isn’t an area where we expect to make money, we’re just making sure we cover our costs.”

    I’m a fairly popular artist but that’s only _because_ I give it away for free. If we give our music away for free and have literally no way of getting revenue how are we supposed to cover the cost of this “purchasing free downloads”? Also, a figure on this would be nice, an actual number of how much we’re “allowed” to give away (I cringe at that thought – allowed to give away).

    Regardless of all this I consider Bandcamp the no. 1 place for independent music, just please don’t fuck it up like some used-to-be-great sites like last.fm have.

  116. Posted July 16, 2010 at 2:36 am | Permalink

    Hi guys, I am also happy to contribute to this great “adventure” with BC.

    I also do agree with some comments posted up and in particular:
    1. I think that both 15% and 10% are “fair” enough. I would prefer to have one % for everyone, as i don’t understand why “smaller” have to pay more than the “bigger” ones. So it maybe 15% or 10% for everyone of us.
    2. I also think it’s interesting the physical selling point. Maybe for this sales, a lower % would be more consistent with the use of the system or so it seems to me.

    Thank you!

  117. Posted July 16, 2010 at 3:13 am | Permalink

    I feel 15% is quite fair for download sales, but I’m more skeptical about it for sales of physical packages. Those of us, like me, who are dealing in very limited underground releases already have tight margins, and with production of physical packages, paypal fees, and shipping, there’s not a whole lot left over, so then 15% is rather steep.

    I would be more for a lower rate for physical packages, and/or a gradual increase of fees, scaling up with the level of sales of the account. For example, free until $500, 5% until $1000, etc, until 15%.

  118. Cole
    Posted July 16, 2010 at 4:48 am | Permalink

    Sounds good. I’ve mostly been using bandcamp to share my music with others in order to get gigs, but when I make the sale, you guys are more than welcome to a cut. Viva Bancamp!

  119. Posted July 16, 2010 at 5:49 am | Permalink

    15% tax for lower earners and 10% tax for higher earners?
    So the more money you are making the less tax you pay?
    If, as the many above comments suggest, 15% is so eminently reasonable, surely the groups and artists selling larger amounts would happily accept the higher rate and leave the smaller acts on the lower rate to encourage growth.
    It’s a very Conservative taxation system and VERY off-putting.

  120. Posted July 16, 2010 at 6:15 am | Permalink

    Happy to let you guys have 15%. And I really hope that we are able to get it down to 10% ;-)

    One question though: is the 15% calculated on the base price, or also on the shipping costs? The latter would mean that a lot of people have to change their pricing I guess.

    Cheers and thanks for an awesome service

    Bart – Sellfish

  121. Posted July 16, 2010 at 6:35 am | Permalink

    @Arch Valenz

    ‘This is bullshit. I boycotted iTunes and practically every other service because of this. Who the hell do you guys think you are taking a cut of musicians music without paying us an advance? You will become the most premier music service this year but I will not be a part anymore. Other independent musicians such as myself should feel the same disgust as I do.’

    What planet do you live on? Born with a silverspoon up your arse? Who the hell do you think you are to demand a service as straightforward and well-thought out as this for FREE???

    Tell you what: try buying some server space and upload your tracks to it. Without paying for it. Try to set up a viable method of receiving payments. You’ll need a merchant bankers account. Without paying for it. Then formulate a method of creating discount codes, download codes, stat tracking, incoming traffic tracking and a place to sell your physical stuff from. Without paying for it.

    Or try and burn CDs, press vinyl, record tapes, put on USB. Without paying for it.

    I could understand your anger if bandcamp’s service was utterly rubbish; but it’s not.

    Ok it galls you that a service wants to take a cut of your sales to pay for the service.

    Try doing all off your own back and setting up a similar infrastructure, only with yourself meeting all the upfront costs first – then by all means keep ALL your sales.

    Perspective. Please.

  122. Posted July 16, 2010 at 8:14 am | Permalink

    Hi Bandcamp,

    I’m incredibly happy to hear about something that will keep you alive. I made my foray into digital music sales with bandcamp and for that I am quite thankful.

    As one of the lesser artists of bandcamp I have to echo / “me-too” / agree with some of the other folks; I think that initially those fees are probably looking kind of steep to someone that’s only made a couple bucks here and there from bandcamp. The “free to a certain point, then fees” model is interesting, and would certainly help that crowd out. Naturally, you will want to point out that there is no charge to get set up, upload your music, etc. And for the others, I certainly appreciate that the percentage goes down instead of up (helping you look less greedy in the process, which is good for the folks that don’t know you offered bandcamp for free for awhile).

    I think two things that remain unclear that some of us may want answers to are the following:

    1) Will the revenue sharing allow you more time to work on feature requests? While seemingly unimportant, some of our features would improve your quality of service and take maybe a few minutes. I understand you guys are busy, so hopefully bandcamp becoming a moneymaking endeavour would give you more time to devote attention to it.

    2) How are you thinking will the revenue sharing occur? We know you haven’t gotten it *exactly* down, but even basic stuff like are we going to get billed for our sales, or is the paypal automation going to automatically split the payment and send it to the right place, or will it log one payment to us and then fire off a separate automatic paypal payment from our account to you…what path has been chosen since the customer is directly paying us?

    By the way, I don’t care about the paypal thing, I don’t think bandcamp needs its own POS system, and if you implemented one I might even ask if it could be optional. I’m very fond of using paypal and the micropayments howto was very helpful.

    I so wish I could drive traffic directly to my bandcamp. But there is no place to link my twitter, facebook, and one or two other important pages. I feel my music would fare better if there were better ways to intermingle the two.

    All in all, I think keeping the ship floating is probably more important than decking it out, so congratulations on the model once again and hopefully it will give you more time to devote to artists’ needs.

  123. Posted July 16, 2010 at 8:46 am | Permalink

    Hi,

    First off, bandcamp is fantastic – easily the best digital distribution service I’ve used. I’m happy that you make some sort of profit from the excellent service you provide. Keep it up.

    Just to back up a few of the comments/themes already posted:

    1. your cut of physical sales should be much smaller (if not non-existent in the case of physical-only packages). A question: is shipping included in the total you take your cut from? If so, that seems really unfair.

    2. I definitely support the idea of a zero/low-%-cut introductory scheme – even if that’s just the first couple of hundred downloads. I think you’ll scare off many potential users otherwise.

    3. 15% then 10% at higher sales seems like the wrong way round to me. One rate across the board seems fairer (and if anything, a scale going the opposite direction would seem to make more sense, penalising us little guys less).

    4. just a touch more notice would have been nice :o)

    Some of these aspects obviously require a little more thought, but I’m certainly not against you guys getting your cut in principle. Keep up the good work, and thanks for the consultation.

    Cheers,
    Jo

  124. Posted July 16, 2010 at 10:14 am | Permalink

    Sounds like a good deal to me. Bandcamp is the best tool for artists to sell their music and now their merch.

    your idea of creating packages is fantastic. i really think that this type of functionality will and should stimulate artists to come up with new ways of marketing themselves to their fans, and it adds value that you will never get from iTunes.

    if i had one Banscamp wish, i would really like to see some kind of shopping cart or a better way of calculating the shipping costs. i feel like we could possibly be losing sales in that, if someone wanted to buy a couple of different cds they have do it individually and pay the full shipping for each purchase. a few times i’ve had to deal with it after the fact and offer a refund on some shipping costs or a free download of something else. it makes me wonder how many people don’t even bother to make even one purchase because of this.

    that said, Bandcamp is not only the best solution for artists to create their own online music store, in my opinion it’s the only option worth considering. there is simply no other service that comes close. believe me, i’ve looked. even a service like CD Baby although good, can be too costly for an artist with no cash flow to even get started with. i knew without a doubt the moment i discovered Bandcamp that it was something special.

    thanks BC! Let’s get it!

  125. Posted July 16, 2010 at 11:37 am | Permalink

    So there was a comment I got in my email that I don’t see here yet about the limited layout options (what do you want, to make your page look like MySpace?) and about not having much cost now that everything’s built out. Obviously though there’s nothing wrong with them wanting to recoup some of the costs spent on building it out to this point, and they’ve stated intentions to keep building out new features, so the limited cost argument is silly (hosting costs notwithstanding).

    To play devil’s advocate to the people complaining that 15% of low income is too much: Let’s face it, if your income on your music right now is low enough that you feel like 15% is really hurting you, Bandcamp sales are nowhere near your personal primary revenue stream. You’re not making music to make money (yet), you’re making music because you love to make music and you’re putting it out there in the hopes of having people listen to it and maybe make a couple bucks.

  126. Jared
    Posted July 16, 2010 at 11:47 pm | Permalink

    I’d like to echo what others have said. Paypal taking a cut was fine, Bandcamp taking a cut is fine, but I don’t think I should paying you to post a link for someone else to process payment. If you have your own payment system, I think 15% is deserved and fair. But all you’re really doing now is hosing a page with some fancy music players and a Paypal link I could create myself.

    I think a Bandcamp integrated payment system is absolutely imperative. I love the site, but I won’t refer people to it, because customers don’t like Paypal. They don’t know what it is, and it’s a cumbersome website. They’d rather buy from iTunes.

  127. Posted July 17, 2010 at 5:49 am | Permalink

    Its great that people are trying to find more creative ways to make money because the old school way of making it via cds its slowly drying up. VIc

  128. Jim Goodin
    Posted July 17, 2010 at 5:51 am | Permalink

    I think it’s a great option you doing to the indie artist community of the world. What I do does not as yet have enough draw that you guys can ever count on me for your retirement but frankly I hope it one day does. For now at least you can sleep at night knowing you’ve helped a lot of musicians such as myself to at least keep their music out there. Thanks Bandcamp.

  129. Redwing
    Posted July 17, 2010 at 6:05 am | Permalink

    I think this business model sounds totally fair and reasonable. However, once BC begins to make money, I’d be much happier to see a payment gateway set up. (ie. Give fans the option to pay with Visa or MasterCard rather than PayPal).

  130. Posted July 17, 2010 at 7:00 am | Permalink

    I think 15% to Bandcamp is fair and acceptable. Afterall, if you (or I) were known artists in the music industry our cut would be that 15% and the rest going to the “machine”.

    I trust the folks here at Bandcamp because they continue to move forward to the benefit of the artists. Just think how much more can be done with the 15% they’re asking for…it’ll be used wisely.

    Personally I’m thankful for Bandcamp and gladly cough up 15% of sales.

  131. Posted July 17, 2010 at 7:36 am | Permalink

    Good for you Bandcamp. 15% isn’t bad at all(of course, I’ve yet to make any sales….)

    I think I agree with the comments about sales volume relating to percentage. Does Bandcamp get something out of an artist selling more? Is that the reason to reward them for selling more? If there is no economic reason for Bandcamp to reward greater sales then I say don’t do it.

    If there is anything I’d add to your service it would be the parent-label qualities that keep me using Tunecore and Kunaki but overall I’d say you really seem to understand what it is like to be an artist trying to distribute music and I’m thrilled with your product and proposed business model.

  132. Posted July 17, 2010 at 9:46 am | Permalink

    I agree with psycliq and magnadrive. I think a graduated cut is a better idea for those who really are not selling much (at least in the beginning). I also think you need another sales interface (keep PayPal, but add your own) and a better (read: more efficient) way to upload full albums.

  133. Posted July 17, 2010 at 9:54 am | Permalink

    Thanks again for the feedback everyone, much appreciated! We’re giving it all some thought and expect to have an update for you next week.

  134. Posted July 21, 2010 at 11:50 am | Permalink

    Post updated. See “Update July 21st, 2010″ back towards the top.

  135. Posted July 21, 2010 at 2:01 pm | Permalink

    Two things I wanted to add to this discussion:

    1) Now artists will receive a lower percentage from single downloads through Bandcamp than they would from iTunes or Amazon. Although from what I’ve seen, I think it’ll be offset by the name your own price thing. Here’s hoping.

    2) I get where you’re coming from on the physical sales thing, but I actually think it might be less profitable for Bandcamp than free physical sales.

    I can’t see myself offering physical goods through Bandcamp or any other site that takes a cut unless it were coupled with order fulfillment. Maybe I and everyone else in these comments are just the vocal minority here, but if we’re not, and everyone pulls their physical goods from their stores, there will be less money for Bandcamp, not more, since physical bundles already make more money for Bandcamp by encouraging digital sales.

    Of course I could be wrong, depending on (A) how effective physical bundles are at generating additional paid downloads and (B) how many artists think 15% of physical sales is a deal breaker. I guess you may as well try it out and see what happens, and I don’t claim to know your business better than you do. But based on the fact that the most popular merch store provider for bands (the other BC) doesn’t take a cut, I’d be surprised if artists were accepting of Bandcamp doing so.

    But seriously, all I really want to is to be able to capitalize the “r” in “released” :)

  136. Posted July 21, 2010 at 11:43 pm | Permalink

    Nice job on the new rev share, and even nicer job absorbing and responding to the feedback about it. I love using the service and I recommend it to all our musician friends: I’m happy to share a portion of our very small profits. I look forward to growing our band as the site grows, as well. Thanks for working so hard to make such a cool product!

  137. Posted July 22, 2010 at 5:47 am | Permalink

    Hi Keith, thanks for adding to the discussion. We’ve been saying for a while that artists should familiarize themselves with PayPal’s micropayments option and use that sort of account when it makes sense. With micropayments PayPal takes only 10 cents on a dollar sale. PayPal says to use micropayments when your sales are $12 or less. I wanted to compare PayPal’s standard rate to micropaymants and break down Bandcamp’s cut so I made this spreadsheet:

    It’s understandable that a few people have been confused by this. Free is easy.

    The micropayments option is complicated by the fact that micropayments only work with sales between certain parts of the world, and PayPal doesn’t switch automatically for you. Then, with Bandcamp’s Name Your Price option you don’t know (at first) what your sales will be like, so it’s harder to know whether to use micropayments or not (once you’ve had some NYP sales you can get a feeling for the average). We’ve been talking about adding a feature to Bandcamp where you can enter two PayPal accounts and we’ll use the one that makes you the most money. I think this is a Good Thing and in fact the more I write this the more I think it should be a high priority for us to do. To-do item #42. In the meantime it might be worth creating two PayPal accounts and updating your profile with whichever one is right for your current release/sales.

    Maybe now’s a good time to point out that fans on Bandcamp have overwhelmingly rejected the trend of picking apart albums and only buying one or two hot tracks, automat-style. Across all the artists using Bandcamp sales of albums to tracks is nearly 4 to 1. We wrote about this here (back when it was 2 to 1). That’s incredible to me. Three out of every four sales on Bandcamp are album sales. I think it’s part of the big picture of fans liking the direct connection to you. Also, with Name Your Price fans on average pay 1.5 times your listed price. (An interesting extreme example is Amanda Palmer’s recent release, where she priced her EP at $0.84 as an act of licensing transparency and found that people paid $5 on average. Her rabid fans picked up that ball of awesome and ran with it until they hit the sea and waded to Madagascar.) So $1 sales don’t happen so much.

    There’s an old Icelandic saying that goes “You could buy a lot of ash for that, but is ash what you want?” Usually used when one is complaining about the price of the beer and puffin sandwich combo. Comparison shopping is good and we think the numbers we’ve come up with are competitive (and frankly, when has a company ever engaged in this much public discussion with their customers over pricing structures, etc?), so sure you might find a download service cheaper someplace else. But at the end of the day what do you want a mouthful of? I think we’ve got a pretty amazing product tailored for musicians and we’ve committed to being at your service for a long time (instead of selling out and cashing in [my Armani suit and Goyard bag will have to wait, dammit]).

    I’ll write about your point #2 in a mo.

  138. Posted July 22, 2010 at 7:13 am | Permalink

    You raise some good points about physical goods. Did you know that we don’t allow artists to sell a physical item by itself? This point is missed in a lot of the discussion. We’re not trying to compete with the other BC or Etsy, we think the music comes first and comes every time. The physical goods option on Bandcamp is about bundling your album (always) with items to enhance the overall value and wow factor of your music. Physical goods sales on Bandcamp don’t just encourage digital sales, they are the digital sales.

    I don’t know if we’re ever going to offer physical goods by themselves. Maybe we will. But it’s not where we imagine taking Bandcamp. I think that if you have a lot of physical goods and not much music to sell, a physical goods store is where you’d want to be. Not because of the cut but because your customers won’t be tasked with choosing MP3 or FLAC just to get a Tee (actually I’m not sure what I’m buying here).

    (By the way, Big Cartel’s base subscription level is $120 yearly. Unless you sell more than $800 in merchandise in a year, Bandcamp’s 15% rev share costs you less. I actually think the rates of these different outfits are all pretty competitive, it just depends on what you need out of your online presence. Also obvious reminder: none of us demands exclusive rights to your stuff. Use more than one if it makes business sense.)

    I think bundling physical goods with an album is the coolest, and allows artists all kinds of flexibility when making their fan connection better. Streaming and digital bundling definitely enhance the sales of the merch, and the merch certainly pumps up the sales and satisfaction of the digital (see Amanda one more time, but also our own delicious releases).

    We might partner with a fulfillment house (or houses) in the future, that’s an obvious thing that would make the fan experience smoother and reduce your involvement to just cashing checks (oh the effort!). But you know that the cost of fulfillment wouldn’t come out of the revenue share we have. Nobody does it that way, that’s not the way the fulfillment companies get paid. They get their money from the shipping and handling that fans pay on every purchase. It’s the fans that end up paying for the convenience, independent of the subscription or revenue share deal. I bought a DVD album from a Topspin powered artist the other day (Topspin provides fulfillment) and the Shipping and Handling totalled $8.50. That’s not money that I was giving to the artist on top of the sale price (and then is cut by Topspin’s 20%), that’s pure fulfillment house charge that the artist never sees. Automatic fulfillment isn’t a panacea and it doesn’t figure into the artist’s costs.

    Like I said earlier, I think most of these services are competitive and of high quality, it just depends on what you want. We’ve looked at two years of Bandcamp data, and the fact is a $0 subscription, $0 startup cost and a 15% rev share is a great deal.

  139. Mark Lerner
    Posted July 22, 2010 at 8:08 am | Permalink

    When and how were we going to be notified of this change? I just happened to take a look at the Bandcamp blog and I saw this.

    And “early August” is very soon. Any more precise date?

  140. Posted July 22, 2010 at 8:17 am | Permalink

    You should’ve gotten an email about it at the same time we added the post (if you have a Bandcamp account and your contact email is up-to-date).

  141. Posted July 22, 2010 at 9:31 am | Permalink

    Hmm. I do have a bandcamp account and my contact info is up-to-date. I guess it was an anomaly that I didn’t get the email, or it was somehow deleted.

    At any rate, the changes seem fair and inevitable.

  142. Posted July 22, 2010 at 9:38 am | Permalink

    I’ll have it sent to you again.

  143. Joshua
    Posted July 22, 2010 at 9:49 am | Permalink

    You are going to lose many of your BIGGEST users because of this. Sage Francis, El-P, Myself. I will only use the site for free downloads after that. & I have brought soo many people to this site it isnt funny. I have always said it was the best site for indie artists, but the day you start charging money because of the growth, you lost sight! I can sell my own merch from my own site, or even a myspace page. If the site continues to move in this direction I will delte my account.

  144. Posted July 22, 2010 at 10:46 am | Permalink

    +1 for losing Paypal as the main transactor in the payment process. If you’re taking a percentage (which I’m happy to pay seeing your service has been quite stable!) please consider using some of the money to build a “real” checkout, with Paypal as an option. :)

  145. Posted July 22, 2010 at 11:45 am | Permalink

    Maybe there should be a section where the bands can donate to bandcamp. i know i would.

  146. Glyn
    Posted July 22, 2010 at 11:52 am | Permalink

    Hi

    My first comment in this blog was a general fanboyish ‘Yeah! yaaaY’.
    As the discussion evolves, my feelings begin to clarify. They are still fanboyish and, I am sure, will mature in time, but so far, my response is the following:

    1 Further thoughts about how the Rev-share is a good deal:

    Joe Holt: “We’ve looked at two years of Bandcamp data, and the fact is a $0 subscription, $0 startup cost and a 15% rev share is a great deal.”
    I agree.

    How much would we, the customers, have been willing to pay as a subscription to have our customizable platform and potential shop-front. How much would we have thought to be fair. If the present business proposition were to have been headed “We have set up the basic service, let us discuss fair subscription rates for the future, again, how much would you consider to be fair?”

    I’m adding nothing here to Joes’ statement except a call to consider exact sums of what could constitute fair customer- subscription and startup. Just adding a little extra light which struck me, alongside which 15% of rev share may be considered a great deal.

    2 The definiton of Physical …

    … in ‘Bandcamp context’ as being part Of the digital goods also makes sense to me. For example “When you download this album you receive through the post, a booklet with photos of the production process, signed by the members of the band”, to me, ‘glues’ all the media into the product .

    That is a different animal than T-shirts and tour posters or baseball caps … where, as far as I can see, the musician is free to make his or her own arrangements/adverts on the main ‘band’ website … with the corresponding choice to either ‘do it all them self’ or pay a distributor.

    3 Trust:

    Michael in post 130 said

    “I trust the folks here at Bandcamp because they continue to move forward to the benefit of the artists. Just think how much more can be done with the 15% they’re asking for … it’ll be used wisely.”

    +1.

    Seems obvious to me that these guys are working toward fulfilling a vision which includes but is not dominated by profit. My reasoning has two elements.

    Firstly: The sheer length = 2 years of free service is part of it. They’ve gone for setting up and testing the entire core before even discussing our contribution. To me, that gave the project a very clean test-basis. “What service may be wanted and be workable” has been pushed forward. Pure profit-base would have realistically charged us 15% as soon as digital downloading became stable, but they held back and imo have got a clearer view of ‘what people want’. Solid and realistic as a vision for ‘all of us’.
    Secondly: leaving it much longer before discussing and proposing our financial input COULD have been a strategy for taking advantage of our committing ourselves. I note, with respect, one poster above, who moved his business over to Bandcamp just before this discussion … boats already burnt. It is upsetting. At this moment, though, I feel ‘well it had to happen some time’. If this had happened a year from now, I would have been tempted to call it an act of capitalizing on a created demand.

    As it is, I think they’re doing the right thing and at the right time.

    I hope and expect that our 15% will help well .. SEVEN people recoup what they’ve been putting in for two years. That’s a lot of rent and petrol money at the very least they’ve been putting in. Not to mention their investment in terms of skills-training, hardware and income lost in less ‘venturish’ activities. Also, as Michael says, “Just think how much more can be done with the 15% they’re asking for … it’ll be used wisely.”

    Bottom line, I trust these guys and hope I have, to some extent, been clear in expressing my angle that they are carrying a vision deeper than Their short term – “Armani suit and Goyard bag” – profits, or Our short-term – “make it less than 15% and 0% for physical goods” -savings.

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