Over Christmas, my parents bought me my first MP3 player - a 2 GB Zen V from Creative Labs. It's a great little player and, in addition to advancing me one phase further in the music playback game, it has provoked a brand new obsession. I've been spending hour after hour on AmieStreet.com
Amie Street is an mp3 store with an interesting business model. All tracks start out free to download. As the number of downloads increases, the price creeps up, eventualy topping out at 98cents. Customers can throw as little as $5 onto their account. Then, it's click to buy! The artist gets 70% of the sale price (after paying for a $5 listing fee). [Percentage corrected, thanks, commenter!]
But customers can profit, as well. For each dollar spent, the customer is granted a 'Recommendation' or 'Rec'. I've been tossed a few freebie Recs along the way, as well. When you Rec a song, and the price later goes up (due to additional downloads), you get a cut. It's just a few cents store credit, more of a thank you to the fans, and an acknowledgement that the fans are the really important part of the promotional scheme. I don't know if it will last, but it's just the kind of innovative thinking we need to save the recording industry from devolving into a theft-based free-for-all.
I think it's pure genius. Cheap songs attract customers. Free customer-driven marketting attracts the acts.