CANNES, France, 29 January 2008 — Growing numbers of legal and free music Internet services are appearing offering vast numbers of songs, provided music lovers can stomach the accompanying advertisements.
New York-based Qtrax was the latest to launch a global free and legal ad-funded peer-to-per (P2P) music service on Sunday at MIDEM, the world’s largest music trade event.
And brands including American toy giant Hasbro are starting to team up with the music world to put music into sometimes unexpected places, including children’s toothbrushes.
The kids “Tooth Tunes” toothbrush, which plays tracks by chart-topping artists, has been a resounding success in the USA and will shortly be launched in Europe and Asia.
Qtrax joins the swelling ranks of services offering an alternative to the huge number of mostly young people who illegally download millions of music tracks every year.
“We will provide a vastly better service than unauthorized sites with superior technology, alluring and vast content, and free music that won’t get you arrested,” Qtrax President and CEO Allan Klepfisz told reporters.
The arrival of Qtrax and rival services has been welcomed by the world’s ailing recording industry, which is struggling to recover from the effects of declining CD sales and rampant illegal music downloads.
EMI, one of the industry’s four “majors” (with Universal, Sony-BMG and Warner), recently unveiled massive staff cutbacks.
It has also lost major stars such as former Beatle Paul McCartney, while others such as Robbie Williams have also had publicized differences with the company.
Record companies see the emerging ad-funded online music services as way of wooing back digitally-savvy consumers aged between 13 and 30, which will in turn satisfy their artists and the music rights holders.
Qtrax and the other legal, free P2P music services have the backing of the recording industry for the first time.
They’re able to offer legal music for free thanks to a slew of licensing agreements with the major labels as well as the publishers and even some leading independent labels.
Added to that, the new music download services say they can supply music and videos free of the viruses that often plague illegal download sites like LimeWire and provide better audio quality.
“We believe we have the killer application,” co-founder of Rebel Digital and Qtrax consultant, Laurence Ford, told AFP, adding that it took Qtrax three years to negotiate copyright with the recording industry.
Many of the other legal, free P2P services are music and music video social networking sites that don’t all let fans download music.
Imeem, the fastest growing and fourth largest social networking site in the USA, lets registered users stream songs and music video live from the Internet from artists and labels with whom it has copyright agreements as well as sharing favorite tracks with their friends.
If imeem is any example, the uptake of the new free services could be rapid.
Imeem, which is fully live in the United States and Canada and is growing internationally, has pulled in 20 million users in just 20 months, said chief marketing officer and head of business development Steve Jang. It was gaining between 65,000 and 70,000 new users every day, he added.
As the new service catches on, the whole legal free music scene could explode if online players such as video-sharing giant YouTube and social networking sites such as Bebo and MySpace move in.
Meanwhile, in Los Angeles, a revamped online file-sharing service that promised to offer unlimited, free music downloads from all the major record labels hit an apparent snag on the eve of its planned launch yesterday after Warner Music denied it had given the service permission.
Qtrax touted in a press release on Sunday morning that it was the first Internet file-swapping service to be “fully embraced by the music industry,” and boasted it would carry up to 30 million tracks from “all the major labels.” New York-based Warner Music undermined that claim, declaring in a statement that it “has not authorized the use of our content on Qtrax’s recently announced service.” Universal Music Group and EMI Group PLC later confirmed they did not have licensing deals in place with Qtrax, noting discussions were still ongoing. A call to Sony BMG Music Entertainment was not immediately returned.
Music services such as Qtrax must secure licensing agreements from the record companies, which own the rights to master recordings, and music publishers, which control the rights to song compositions. Each of the major recording companies also operates music-publishing units.
Qtrax’s president and chief executive, acknowledged Sunday that the deal with Warner Music had not been signed, but said he expects to reach an agreement on terms “shortly.” “With everybody else, we have agreed on all terms,” he added, noting that in some cases, deals had yet to be formally signed.
Qtrax made its online debut yesterday, a day after its splashy coming-out party at the annual Midem music business conference in Cannes, France.
The development marked an inauspicious start for Qtrax, the latest online music venture counting on the lure of free music to draw in music fans and on advertising to pay the bills, namely record company licensing fees.
The service was among several peer-to-peer file-sharing applications that emerged following the shutdown of Napster, the pioneer service that enabled millions to illegally copy songs stored in other music fans’ computers.
Qtrax shut down after a few months following its 2002 launch to avoid potential legal trouble.
The company said it latest version of the service still lets users tap into file-sharing networks to search for music. Downloads however come with copy-protection technology known as digital-rights management, or DRM, to prevent users from burning copies to a CD and calculate how to divvy up advertising sales with labels.
Qtrax downloads can be stored indefinitely on PCs and transferred onto portable music players, however.
The company also promises that its music downloads will be playable on Apple Inc.’s iPods and Macintosh computers until April 15. That’s unusual, as iPods only playback unrestricted MP3s files or tracks with Apple’s proprietary version of DRM, dubbed FairPlay.
In an earlier interview, Klepfisz declined to give specifics on how Qtrax will make its audio files compatible with Apple devices, but noted that “Apple has nothing to do with it.”
Apple has been resistant in the past to license FairPlay to other online music retailers. That stance has effectively limited iPod users to loading up their players with tracks purchased from Apple’s iTunes Music Store, or MP3s ripped from CDs or bought from vendors such as eMusic or Amazon.com.
Phone and e-mail messages left for Apple on Sunday night were not immediately returned.
Rob Enderle, technology analyst at the San Jose-based Enderle Group, said he expects Apple would take steps to block Qtrax files from working on iPods.
Last fall, the company issued a software update for its iPhones that created problems for units modified by owners so they would work with a cellular carrier other than AT&T Inc. As a result, some modified phones ceased to work after the software update.
The move prompted antitrust lawsuits on behalf of some consumers.
