Lady Gaga: accept free downloads, go touring!

Lady Gaga has no problem with fans downloading her music, according to a recent interview with Times Online.

Gaga even used the free distribution of her music to build her popularity. This popularity ultimately paid off in sold out tours and corporate sponsorships.

The latter apparently works very well for Gaga: corporate sponsorships are fairly obvious in her latest video clip, usefully called “Telephone”. Coca Cola (2.59min), Virgin and LG (see 4.17min) and Polaroid (5.44min) are in clear view.

Gaga explains that today the real money is earned with touring:

“Big artists can make anywhere from $40 million for one cycle of two years' touring. Giant artists make upwards of $100 million. Make music -- then tour. It's just the way it is today."

This vision of Gaga is a combination of trust in new business models and old methods:

"I hate big acts that just throw an album out against the wall, like 'BUY IT! F*** YOU!' It's mean to fans. You should go out and tour it to your fans in India, Japan, the UK. I don't believe in how the music industry is today. I believe in how it was in 1982."

The new business model for music artists according to Gaga: treat your fans right, learn to leverage what's infinite to make something scarce more valuable, and then sell the scarcity.