Radiohead have shocked their fans by asking them to choose how much they want to pay for their new album.

The band, whose best-selling albums include OK Computer, announced their seventh album, In Rainbows, on their website.

They said of the price "it's up to you" - and then added: "No really, it's up to you."

Because the album is only available on their website, the band's latest offering will not be eligible for the chart.

Fans can either pay £40 for a deluxe box set on CD or download from October 10 at a price of their choosing.

Radiohead guitarist Jonny Greenwood made the announcement online. The band, led by Thom Yorke, are also planning a traditional CD release of In Rainbows for early 2008.

Radiohead decided not to use a record label after fulfilling their contract with EMI following their 2003 album Hail to the Thief.

The music industry was also reacting today to the news that The Charlatans are giving away their new single, You Cross My Path, free on the internet.

Alan McGee, the Britpop band's manager, said The Charlatans believed the current business model for selling music was redundant and future income would come from ticket sales for live shows and merchandise.

James Bates, a director in the media and entertainment division of the professional services firm Deloitte, said of Radiohead's move: "While they have enough money and popularity it could be argued that they care deeply about the creative process and this move may be genuinely altruistic in support of their fan base.

"Or perhaps they expect this model will drive revenues through the sale of ancillary goods and ultimately there would be no loss in overall revenues." Whichever it is, it would appear that for Radiohead the record company model does not have enough to offer them at this point.

"Up to now record companies have focussed their business saving efforts on consumers and piracy. Radiohead are clearly trying to build an independent business model that suits their needs." Unless record company giants wake up and find a model that delivers real value to artists, technology will continue to be used to by-pass the record companies and in comparison piracy will seem a relatively small problem."

He added: "While Radiohead may be one of just a few bands that is in a position to take such a bold step, their actions have significant implications for the industry."