In 1996, the Internet was a curiosity for most, the record labels were swollen with cash from CD sales, and R.E.M.'s "New Adventures in Hi-Fi" could only add to that hoard. Critics and fans drooled for the alt-rockers' follow-up to their last two hit albums, and the media counted down the days until the CD hit stores in September of that year.
But when it was released, music buyers yawned -- the start of a steady decline in U.S. album sales for R.E.M. as hip-hoppers and pop divas eclipsed the band. The record industry itself didn't do much better, as sales overall shrank from its halcyon days of routine multi-platinum hits. Record labels are quick to blame Internet piracy; many fans point to high CD prices instead.
In 2004, both R.E.M. and the record industry are turning to the Internet to reverse their fortunes. Today, the band releases its 13th major album, "Around the Sun" -- but for hundreds of thousands of fans, there's no suspense. They've already listened to the entire album for free on the Internet over the past two weeks, and with the band's label's encouragement.
That label, Warner Bros. Records, allowed "Around the Sun" to be posted, starting Sept. 21, on MySpace.com, a Los Angeles-based Web site launched last year that combines content and community. The site allows users to post personal profiles with pictures, set up blogs, chat on bulletin boards, play games and so on, combing elements of Friendster.com, Match.com and America Online.
The move represents a new strategy for an aging band hoping to recapture a youthful U.S. audience and an ailing record industry finally embracing the promotional capabilities of the Internet.
"It's a unique opportunity for [R.E.M.] to reach out to a new demographic and a unique opportunity for us to expose our demographic to a superstar band," said Chris DeWolfe, MySpace's chief executive.
R.E.M. is one of several bands featured on MySpace. In addition to streaming all 13 songs on "Around the Sun," R.E.M. fans can use MySpace (www.myspace.com/rem/) to see band tour dates, buy the album at Amazon.com, download cell-phone ring tones that sound like some of the band's singles and read a band biography.
There are some hitches: The band and Warner Bros. required MySpace to disable the "forward" and "reverse" buttons on the Web site's media player, meaning that users have to listen to the album in its entirety, unable to skip from song to song. Also, the songs cannot be downloaded to computers or any other devices, such as MP3 players.
More than 600,000 users listened to the album the first week it was posted, DeWolfe said. Now that R.E.M. is what the industry terms an "adult alternative" act -- meaning its songs are almost never played on pop music stations and the bulk of its listeners are over 30 -- exposure on sites such as MySpace is critical. Most of MySpace's users are between 16 and 24, DeWolfe said, and the market-research firm NetRatings Inc. estimated that the site drew 2.5 million visitors in August. (Parents of younger MySpace users should be aware that some of the site's personal profiles contain nude photos.)
"I'm really honored that so many MySpacers tuned in to our new record on MySpace," R.E.M. frontman Michael Stipe wrote on the site. "It's a great site and we've enjoyed the feedback."
DeWolfe will not disclose terms of the deals he strikes with record labels, but he said his site sometimes pays labels for the right to post the songs and sometimes barters for services of equal value.
Music labels are trying a number of online strategies, not only to boost sales but to gain crucial data about their customers.
For example, some labels under Universal Music Group -- the world's largest record company, with more than one-quarter of all global sales -- give record buyers Internet-only bonuses when they buy CDs.
Included in each copy of the latest CD of rapper LL Cool J, on Universal's Def Jam Recordings label, is a unique code. Fans who purchase the CD can enter the code at LL Cool J's Web site and, after registering, gain entry to a VIP section with more songs, videos and other exclusive material. Universal also partnered with the online auction firm eBay Inc., allowing LL Cool J's VIP-section fans to bid for a day in the studio with the best-selling rapper, including the opportunity to record a track with him.
In exchange for offering those bonuses with the LL Cool J CD, Def Jam gets data about its customers who register online, information that it can use to better target marketing efforts for its artists.
"Now you have a profile of who your consumer is," said Larry Mattera, senior vice president for Island Def Jam Music Group. "It helps us to target where to spend our marketing budget."
Mattera said he has been approached by MySpace but has yet to release one of his artists' songs to the Web site. "They come after us for A-list artists and we want exchange of value," he said. He would give one of his top-sellers to MySpace, he said, if the site would also post the music of one of his lesser-known "baby bands."
Many bands are making new albums and singles available for sale at online music stores, such as Apple's iTunes and Napster, before physical CDs arrive in record stores. The early-to-market strategy has been necessitated by the rise of peer-to-peer file-sharing networks, such as Kazaa.com, where users trade songs for free.
"If we can simply allow more people to purchase [a song] than take it from Kazaa, it's a success," Mattera said.
The explosion of online options has almost destroyed the concept of release date, the highly anticipated day that fans would swarm music stores to buy their favorite band's new album.
On MySpace, Stipe wrote that "the record comes out for real on Tuesday Oct. 5th." But for many of the R.E.M. fans who read his posting, "Around the Sun" has been out "for real" for nearly three weeks.