STEVE INSKEEP, HOST:
Let's talk next about Kickstarter. That's the website that lets people with an idea or project ask other people to contribute toward making it happen. It's a little like crowdsourcing, where you get information from many places, except this is called crowd funding, and this summer's big success story was musician Amanda Palmer. She raised more than one million dollars to produce her new album. But NPR's Frannie Kelley reports that for some musicians crowd funding does not always work.
FRANNIE KELLEY, BYLINE: Internet-based crowd funding works sort of like a bake sale. You pay a little bit more than that cupcake's market value, and then when your friends ask where you got it, you tell them the gym needs a new roof and the 11th grade is raising money to fix it. Album sales are less than half what they were 10 years ago. Your local musician needs a new roof.
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THE PHYSICS: Let me show you what it is in my city where I live. You could come by way because we don't do it the same.
KELLEY: The Seattle-based hip-hop group the Physics put out its first album five years ago without the help of a record label. They played all over their hometown, toured the country, and hit the festival circuit. But it wasn't until this summer that the Physics decided to try a Kickstarter campaign to fund the release of their latest album, their fourth. Gathigi Gishuru, known as Thig, is one-third of the Physics.
THIG NAT: Over the last few years, the Seattle hip-hop scene has been taking off. And so we've literally seen how the crowds have grown at shows from a hundred people to, you know, a thousand people at these venues, so for us there was no better time than now to take advantage of that.
KELLEY: The Physics hoped to raise $8,000 in about a month. They set up their campaign like a pre-order for the album they had just finished recording. They ended up raising $11,721 from 242 fans and released "Tomorrow People" last month.
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THE PHYSICS: You know the name and if you don't then I'll explain in case ya heard about it, they word of mouth that we celebrate the finer things in life beyond the monetary is so secondary if my team they right I ain't new to it I'm just cool with it catch me sipping a brew, but if you can do it the way that I do it but not be doing it, go...
THIG NAT: Most of our fans do have a Facebook, they do have a Twitter, they do have Instagram. So I think Kickstarter and, you know, even all online crowd-funding opportunities, I think for them to work you have to have a fan base that is easily engageable online.
KELLEY: Thig says The Physics' fan base ranges from kids in high school to people in their 30s. That age group operates comfortably on the Web. But an active, engaged audience doesn't necessarily translate to active support. Sinan Aral is a scientist who teaches at New York University's Stern School of Business.
SINAN ARAL: Typically in talks I ask people to raise their hand if they follow Ashton Kutcher on Twitter or know who Ashton Kutcher is and everyone raises their hand. I have them put their hands down, then I ask, who in the room has ever done anything that Ashton Kutcher asked them to do, and typically one sheepish person will raise their hand.
KELLEY: But what about an artist somewhere in between the Physics and Ashton Kutcher?
TERRE ROCHE: I had never done anything like that before. I had never asked someone for money. There always had been a record label or, you know, you do a gig and the people would come and they'd pay.
KELLEY: As Terre Roche wrote in an op-ed in the New York Times in June, the job description has vastly changed. Major labels don't make enough from pop star blockbusters to subsidize up-and-comers the way they did when she started out. That was in 1975, when she released the first album with her sisters, the Roches. They toured constantly and put out more than a dozen records on major labels. But the Roches stopped working together about a year and a half ago. Terre is now recording an album with her new group, called Afro-Jersey.
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AFRO-JERSEY: Elephant, remember the elephant. Elephant, remember the elephant because she remembers you.
KELLEY: Roche decided to give crowd funding a try to raise money for studio time, to pay a producer, and get the album mastered.
ROCHE: And in the beginning I was very enthusiastic about it because I thought, oh, this is cool because you don't have to audition for somebody and you don't have to get picked by a record label.
KELLEY: Crowd funding gives musicians who don't like their arrangement with a record label another option. And it gives musicians who might not ever get a record deal a chance to put their work directly in front of people who might like it. It also requires musicians to do at least some of the work record label employees used to do.
ROCHE: Okay. What I did was...
KELLEY: Roche pulls out the three-ring binder she used to organize her crowd-funding campaign.
ROCHE: I sent out to everyone on the Facebook list, right? So then I realized I had to make a list of everybody. So I have this book. This is everybody who I sent things to and the different colors here, like if someone contributed, I'd put an orange line and then I would thank them, and then I'd put an X if I thanked them.
KELLEY: Roche didn't meet her goal of $21,000. She fell short by more than half. That could be because she doesn't tour anymore, so she doesn't have that kind of direct contact with fans. And she admits she felt strange asking her Facebook friends for money. She says she doesn't have that skill set. One person who definitely does is Amanda Palmer, this year's big Kickstarter music success story. The $1.2 million she raised for her new album generated headlines. In the video that kicked off her campaign, Palmer held up a sign that said "this is the future of music." I asked Terre Roche if she thinks that's right.
ROCHE: It's the present.
KELLEY: I asked Thig of the Physics if he would do another crowd-funding campaign.
THIG NAT: I don't really feel like this is the kind of thing that you can continue to do from year to year, because at a certain point your fan base or people are going to be like, hey, you know, the novelty has kind of worn off.
KELLEY: And if you get too successful, New York University's Sinan Aral says it gets even more awkward to ask for help.
ARAL: If Katy Perry were to run a Kickstarter campaign, I'm not so sure it would succeed because people would say, hey, you know, you're Katy Perry, you should be able to pay for this yourself.
KELLEY: Musicians do have to spend money and a lot of time to hit their crowd-funding goals, so failure is expensive. But for some people, at specific moments in their careers, crowd funding can be a piece of the puzzle. Frannie Kelley, NPR News.
INSKEEP: Tomorrow we'll look at another piece of that puzzle, music-streaming services and how much or little they help musicians.