This morning a lot of posts discuss the announcement that Qtrax has signed deals with all 4 major music labels for the peer2peer free ad-based music download service. Interesting enough, after everyone has started quoting each other on this “break through”, the Silicon Ally insider reports that 3 of the four labels claim they do not have a deal with Qtrax. Oops.
But let’s move beyond the “breaking” news and look at the service offering itself. Qtrax claims to offer 25 Mln songs which can be downloaded. There are a few nags though. First of all the songs are DRM wrapped, meaning they can’t be played on any devide you want. Second, you need a specific piece of software to be able to download and play the songs. Third, the songs are free but ad-based, meaning there are ads wrapped along with the songs.
Now let us compare this to the current offering for any user with a PC and peer2peer software. You have access to over 25 Mln songs, you can download them and play them on any device you want. They are DRM free. You don’t need any specific software for it, and there are no ads. It is illegal, but millions and millions of Internet users do not seem to mind that.
I have serious doubts such a service will ever become really popular. Peer2peer networks have reduced the distribution costs of music, or any relevant content for that matter, to 0. It means that there is no money to be made out of the distribution game anymore, making the major music labels obsolete really. Trying to overcome that by restricting downloads and serving ads isn’t going to change the reality of today. It is a defensive move if any. It is enforced by the music labels that still do not want to give up their false hope of controlling the game. And Qtrax is falling for that pressure or they can’t distribute the content legally.
In my opinion this is not the revolution we really need in the music industry. The battle of paying for music has been fought and lost. Instead music labels should focus on things that still matter to the consumer. Instead of distribution of music the major music labels should be thinking about the distribution of emotions. I’m a big fan of Ian Rogers who works for Yahoo Music. He understands the need to open up the music industry and won’t invest any longer in services that try to leverage digital scarcity. I think that Yahoo is getting back into the game the right way.
There are infinite possibilities to create relevant and great business models in the music industry. But it takes leadership and the willingness to burn old ships behind you to start changing this world. Qtrax is not a revolution, it is merely a new wrapping around an industry based upon old school thinking. It won’t work.